Consider the figure below. An increase in uncertainty would lead to a movement from This graph plots P L on the vertical axis versus Real G D P on the horizontal axis. Two parallel increasing short-run aggregate supply curves, labeled S R A S 1 and S R A S 2, are plotted on the graph. S R A S 2 lies to the right of S R A S 1. Point A lies above point B on S R A S 1, and point C lies above point D on S R A S 2. A price level below what was expected would result in a movement from point A to point B. If the cost of productive inputs falls, then the short-run aggregate supply curve will shift to the right and produce a movement like that from point A to point C. If the future becomes increasingly uncertain, businesses will reduce production now, and the aggregate supply curve will shift to the left as depicted by a movement from point D to point B. A to C. A to B. D to C. D to B