When plotted with the aggregate price level on the vertical axis and output on the horizontal axis,the long-run aggregate supply curve
A)slopes upward.
B)slopes downward.
C)is vertical.
D)is horizontal.

Question

Quizplus · Accepted Answer

The long-run aggregate supply curve is vertical because in the long-run, changes in the price level do not affect the level of output, which is determined by factors such as technology, resources, and the size of the labor force. Therefore, the long-run aggregate supply curve is a vertical line at the potential output level, which is the maximum sustainable output that the economy can produce.

When Plotted with the Aggregate Price Level on the Vertical