CFA Practice Question

There are 539 practice questions for this study session.

CFA Practice Question

Which of the following will shift the LAS curve to the right?
I. An increase in the supply of resources
II. Improved technology
III. A substantial increase in the minimum wage for young workers
IV. Lower interest rates
A. I and II
B. All of these factors
C. II and IV
Explanation: The resource base and level of technology determine the LAS.

User Contributed Comments 6

User Comment
yanpz If Institutional Change should be counted in, should the answer be I, II and III?
kidkid An increase in minimum wages would cause employers to reduce supply I think. b/c it is more costly for them?
snider True. That would shift the LRAS curve to the left, not right.
StanleyMo and interest rate affect demand.
serboc Lower interest rate.---> doesn't this increase money supply or cheaper capital?
stupee lower interest rates - this will move along the LAS, not shifting the curve.
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