2.3 Flashcards
1
Q
AS curve
A
shows quantity of real gdp supplied at different price levels
2
Q
Short run
A
at least one factor of production is fixed
3
Q
Long run
A
all factors of production are variable
4
Q
Factors influencing SRAS curve
A
Cost of raw materials - rise in costs will cause an inward shift
Exchange rates - stronger currency means cheaper imports causing outward shift
Tax rates - higher tax means more costs so inward shift
5
Q
Factors influencing LRAS curve
A
Technology - Better tech means higher quality and quantity of goods produced
Productivity - Higher productivity mean more goods produced with the same input
Education - better skills and education leads a variety of G+S produced
Regulation - limits how productive a firm can be
Migration - can bring in new skills and workforce
