which of the following would cause a decrease in short - run aggregate supply in the united states?\na) a…

which of the following would cause a decrease in short - run aggregate supply in the united states?\na) a decrease in the cost of oil\nb) an appreciation in the international value of the u.s. dollar\nc) a decrease in business tax rates\nd) an increase in the price of natural gas\ne) an increase in subsidy payments to ethanol producers

which of the following would cause a decrease in short - run aggregate supply in the united states?\na) a decrease in the cost of oil\nb) an appreciation in the international value of the u.s. dollar\nc) a decrease in business tax rates\nd) an increase in the price of natural gas\ne) an increase in subsidy payments to ethanol producers

Answer

Brief Explanations:

Short - run aggregate supply is affected by input prices. An increase in the price of a key input like natural gas raises production costs for firms. Higher costs lead to a decrease in the quantity of goods and services firms are willing to supply in the short - run. A decrease in oil cost lowers costs and increases supply. Dollar appreciation/depreciation affects net exports and not directly short - run aggregate supply. Decrease in business tax rates and increase in subsidies lower costs and increase supply.

Answer:

D. An increase in the price of natural gas