2.3.1 - The Characteristics Of AS

Question 1

What Is Aggregate Supply (AS)?

Answer 1

Volume of goods and services produced within the economy at a given price level.

Question 2

What Does The AS Curve Look Like?

Answer 2

Question 3

Why Is The AS Curve Upward Sloping?
(2 Points)

Answer 3

~ The AS curve is the combined supply of all individual supply curves in an economy, which are also upward sloping.

~ As real output increases, firms have to spend more to increase production.

Question 4

What Causes A Movement Along The SRAS Curve?

Answer 4

Change in the price level.

Question 5

What Are The 2 Movements That Can Occur?
(2 Points)

Answer 5

~ Contraction.

~ Extension.

Question 6

What Do Movements Look Like On The SRAS Curve?

Answer 6

Question 7

What Causes A Shift Of The Entire SRAS Curve?

Answer 7

A change in the conditions of supply.

Question 8

What Do Shifts Look Like On The SRAS Curve?

Answer 8

Question 9

What Is SRAS Influenced By?

Answer 9

Changes in the costs of production.

Question 10

What Is The Short Run?

Answer 10

Time period where at least one factor of production is fixed.

Question 11

What Is LRAS Influenced By?

Answer 11

A change in the productivity potential of the economy.

Question 12

What Is The Long Run?

Answer 12

Period of time where all factors of production are variable.