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AP® Macroeconomics

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Market Power and AS

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Market power is a determinant of the Aggregate Supply curve.

Identify the situation that BEST exemplifies the determinant.

A

Aggregate Supply curve shifts right when OPEC loses its grip on oil production and cheaper oil prices result in higher output.

B

Aggregate supply shifts right when government reduces regulation on monopolies.

C

Aggregate Supply shifts left when the SEC clamps down on collusion in the computer markets.

D

Price level increase causes the sale of more products

E

Minimum wage increases by Congress expand unemployment in the economy.