SRAS Flashcards
1
Q
why is the sras curve upwards
A
higher prices for goods make output profitable and enable businesses to expand production by hiring less productive labour and resources
2
Q
examples of input costs
A
interest rates, wage costs, labour productivity, raw materials
3
Q
factors of business taxes, subsidies and imported costs
A
- VAT, environmental changes
- scale of govt subsidies
- business rates, meeting business regulations
- cost of imported components
4
Q
supply shocks
A
hurricane, tsunami, droughts
5
Q
external factors affecting sras
A
- world oil and gas prices
- energy prices/costs
- other minerals/ metal prices
- foodstuff prices
- import tariffs/quotas
6
Q
define capital spending
A
gives benefit into the future
7
Q
define current spending
A
gives benefit in current financial period
