When the economy experiences a permanent supply side shock that shifts the long-run aggregate supply to the right, the short run aggregate supply curve will:
A. begin by shifting left initially, and then be pulled right by the long-run aggregate supply over time.
B. gradually shift right until it reaches long-run aggregate supply and the new long-run equilibrium.
C. instantly shift left with the long-run aggregate supply to the new long-run equilibrium.
D. None of these is true.
Answer: B
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