The interaction of aggregate demand and supply (OCR A-Level Economics): Quizzes
📚Quizzes
Practise the questions
12 questions from this quiz
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Practise the questions
12 questions from this quiz
What is the equation for aggregate demand?
What is the equation for aggregate demand?
In the AD equation, what does 'C' represent?
In the AD equation, what does 'C' represent?
Consumption
In the AD equation, what does represent?
In the AD equation, what does represent?
Net exports
What is aggregate supply?
What is aggregate supply?
Total output firms produce at a given price level
What is the shape of the short-run aggregate supply (SRAS) curve?
What is the shape of the short-run aggregate supply (SRAS) curve?
Upward sloping
Why is SRAS upward sloping?
Why is SRAS upward sloping?
Higher prices lead to higher profits
What is the shape of the long-run aggregate supply (LRAS) curve?
What is the shape of the long-run aggregate supply (LRAS) curve?
Vertical
What determines output in the long run according to LRAS?
What determines output in the long run according to LRAS?
Resources, technology, and institutions
Where does short-run equilibrium occur?
Where does short-run equilibrium occur?
Where AD intersects SRAS
What happens when AD increases in the short run?
What happens when AD increases in the short run?
Higher output and higher price level
What happens when SRAS increases?
What happens when SRAS increases?
Higher output and lower price level
Where does long-run equilibrium occur?
Where does long-run equilibrium occur?
Where AD intersects LRAS