The short-run aggregate supply curve shows the various amounts of real output that producers are willing to
A) sell at different profit levels.
B) sell at different price levels.
C) buy at different income levels.
D) buy at different price levels.

Question

Quizplus · Accepted Answer

The short-run aggregate supply (SRAS) curve shows the relationship between the price level and the amount of real output that firms are willing to supply in the short run, holding constant other factors that affect production. Therefore, the correct choice is B, as the SRAS curve reflects the willingness of producers to sell different amounts of output at different price levels. Choice A is incorrect because it suggests that the SRAS curve is based on profit levels, whereas it is based on the price level. Choices C and D are incorrect because they refer to demand, whereas the SRAS curve relates to supply.

The Short-Run Aggregate Supply Curve Shows the Various Amounts of Real