- CFA Exams
- CFA Level I Exam
- Study Session 4. Economics (1)
- Reading 14. Aggregate Output, Prices, and Economic Growth
- Subject 5. Shifts in Aggregate Demand and Supply
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
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. |