2.3.1: The Characteristics Of Aggregate Supply (AS) Flashcards
1
Q
What is aggregate supply?
A
The total value of output for all goods/services at a given price over a period of time.
2
Q
Aggregate supply graph:
(Axis, AD curve, labels)
A
3
Q
What causes a movement along the AS curve?
A
A change in the price level.
4
Q
A rise in the price level causes a(n) ________ in AS.
A
Extension.
5
Q
A fall in the price level causes a(n) ________ in AS.
A
Contraction.
6
Q
What causes a shift in the AS curve?
A
A change in the costs of production.
7
Q
What causes a rise in AS?
A
A decrease in the costs of production.
8
Q
What causes a fall in AS?
A
An increase in the costs of production.
9
Q
What is the difference between short-run AS and long-run AS?
A
Short-run AS: at least one factor of production is FIXED.
Long-run AS: all factors of production are VARIABLE.
