The short-run aggregate supply curve is _____ and the long-run aggregate supply curve is _____.
A) vertical; upward sloping
B) horizontal; vertical
C) vertical; horizontal
D) upward sloping; vertical

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve is upward sloping, reflecting that prices can adjust to changes in demand and supply. The long-run aggregate supply curve is vertical, indicating that in the long run, the economy's output is determined by its resources, technology, and institutions, not by the price level.

The Short-Run Aggregate Supply Curve Is _____ and the Long-Run