The first alternative is correct (A).
The aggregate supply curve shows the relationship between the price level and the quantity of goods and services supplied in an economy.
Notice in the graph that in the short term, the supply curve is affected by input decisions and the price of the good. If companies have idle capacity and perceive an increase in prices, they can increase production and consequently supply. Likewise, they may decrease if the perception is contrary.
T<u>he only way to increase production in the long run is to raise capital and labor levels, ie through investments in the production plant, whether in inputs, physical space or human capital, which would shift the vertical line to the right. If firms do not make this decision to invest, in the long run the capacity for expansion will be compromised and supply can not increase, regardless of price. Output remains constant.</u>
