Suppose the actual and expected price levels in an economy are initially equal. However, the actual price level falls eventually due to a change in economic conditions. Which of the following will occur over the long run??
a. The economy will move rightward along the short-run aggregate supply curve.
b. The economy will move leftward along the short-run aggregate supply curve.
c. The short-run aggregate supply curve will shift to the right.
d. The short-run aggregate supply curve will shift to the left.
e. The short-run aggregate supply curve will become flatter.
Ans: d. The short-run aggregate supply curve will shift to the left.
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