Which of the following correctly identifies components that cause shifts of aggregate supply?

A. Changes in the price of inputs, productivity, and consumption
B. Changes in government purchases, short-run supply shocks, and investment in stocks and bonds
C. Changes in consumption expenditures, investment, and net exports
D. Changes in the price of inputs, short-run supply shocks, and productivity

1 answer

The correct identification of components that cause shifts of aggregate supply is:

D. Changes in the price of inputs, short-run supply shocks, and productivity.

These factors can lead to shifts in the aggregate supply curve. Changes in input prices (such as wages and raw materials), unexpected events that impact supply (short-run supply shocks), and improvements in productivity (which enhance the efficiency of production) all play significant roles in shifting the aggregate supply.