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Aggregate Demand and Aggregate Supply

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❶This horizontal range implies an economy in severe recession or depression. The curve slopes downward to the right, indicating that as price levels decrease increase , more less goods and services are demanded.

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Aggregate Supply


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Determinants of Aggregate Supply. Changes in labor force: Anything that causes the amount of workers to increase in an economy will cause aggregate supply to increase or shift to the right. If the labor force decreases, the overall supply of .

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Aggregate supply determinants are held constant when the aggregate supply curves are constructed. A change in any of these determinants causes a shift of either the short-run aggregate supply curve, the long-run aggregate supply curve, or both. Learn aggregate supply determinants with free interactive flashcards. Choose from different sets of aggregate supply determinants flashcards on Quizlet.

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The best videos and questions to learn about Determinants of aggregate supply. Get smarter on Socratic. The ability to produce is summarized by the long run Aggregate Supply (AS) function based on the level of technology and availability of factor inputs. The ability to spend is summarized by the Aggregate Demand (AD) relationship which represents combinations of income and interest rates such that product markets and financial markets are in .