An increase in the expected price level shifts which curve and in which direction?

aggregate demand curve shifts left.

aggregate supply curve shifts right.

aggregate supply curve shifts left.

aggregate demand curve shifts right.

Expert Solution

Expected price level is a determinant of aggregate supply curve.

An increase in expected price level reduces the quantity of goods and service supplied and shift the short run aggregate supply curve to the left.

Answer: Option (C)

Rahul Sunny answered 2 years ago

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