Graphically demonstrate the effect of each of the following on either the short-run aggregate supply (SAS) curve or the long-run aggregate supply…
Graphically demonstrate the effect of each of the following on either the short-run aggregate supply (SAS) curve or the long-run aggregate supply (LAS) curve. Be sure to label all axes.
a. Businesses find that they are unable to produce more output without having to pay more wages or increasing their costs of capital.
b. Productivity rises by 3% and input prices rise by 5%.
c. A forest fire destroys a significant portion of Canada.
d. The country’s currency depreciates dramatically.
e. Productivity rises by 3% and wages rise by 3%.
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