Price expectations can shift aggregate supply to the right when businesses:

• A. Expect lower production costs
• B. Anticipate stable future prices
• C. Expect higher future prices
• D. Remove existing production capacity

Answer: (C)

The choice that aligns with shifting aggregate supply to the right pertains to businesses expecting lower production costs. When businesses anticipate lower costs for inputs, such as labor or raw materials, this leads to an increase in their willingness and ability to produce goods. As costs decrease, companies can operate more efficiently and profitably, which encourages them to produce more at every price level. This increase in production capabilities causes the aggregate supply curve to shift to the right, indicating a higher quantity of goods supplied in the economy.

In scenarios where businesses expect stable future prices, they are less likely to make significant changes to their production levels since there's no anticipated change in cost or revenue. When businesses expect higher future prices, it could lead to a temporary withholding of supply as they anticipate greater profits later. Additionally, if businesses were removing existing production capacity, this would actually lead to a reduction in aggregate supply, shifting the curve to the left rather than to the right.