Multiple Select Question

Question

Select all that apply

Which of the following explain the reason for the up-sloping aggregate supply curve in the short run?
Multiple select question.

Higher prices mean higher profits when input costs are fixed.

Higher productivity means higher prices are required.

As output rises, costs per unit rise especially beyond full employment.

Input costs are fixed, but output costs are variable.

Answer 1

The correct options that explain the reason for the up-sloping aggregate supply curve in the short run are:

1. Higher prices mean higher profits when input costs are fixed.
2. As output rises, costs per unit rise especially beyond full employment.

These two options illustrate the relationship between output levels, prices, and profits, as well as the rising costs associated with producing additional output in the short run. The other options do not accurately capture the reasons for the up-sloping aggregate supply curve in the short run.