Indicate whether each of the following events will increase, decrease, or have no effect on long-run aggregate supply. Event Effect on Long-Run Aggregate Supply Increase Decrease No Effect The United States experiences a wave of immigration. Congress raises the minimum wage to $15 per hour. Intel invents a new and more powerful computer chip. A severe hurricane damages factories along the East

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Kyleigh Vargas

31 July, 11:20

Indicate whether each of the following events will increase, decrease, or have no effect on long-run aggregate supply. Event Effect on Long-Run Aggregate Supply Increase Decrease No Effect The United States experiences a wave of immigration. Congress raises the minimum wage to $15 per hour. Intel invents a new and more powerful computer chip. A severe hurricane damages factories along the East

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Crane · Answer 1

a. When the United States experiences a wave of immigration, the labor force increases, therefore there would be an increase in the long-run aggregate supply because there are more people who can produce output.

b. When Congress raises the minimum wage to $10 per hour, the natural rate unemployment decreases, thus, leading to the shifting of the long-run aggregate-supply curve to the left.

c. When Intel invents a new and more powerful computer chip, productivity increases, therefore, there would be an increase in the long-run aggregate because more output can be produced with the same inputs.

d. When a severe hurricane damages factories along the East Coast, the capital stock is smaller, thus leading to a decline in the long-run aggregate supply.