short-run

• Aggregate supply refers to the potential output of all goods and services that are produced in an economy over a period of time. it can be both short-run and long-run
• firms have fixed factors of production in the short-run, they are fixed, meaning firms cannot shift they SRAS curve themselves
• firms can change the intensity of utilization of each factor of production, ultimately causing a contraction or extension along the SRAS curve.
• SRAS can only be shifted by changes in factors of production e.g. exchange rates, taxes, costs of materials, or energy, or exogenous shocks.
• an exogenous shock refers to a largely unexpected event that significantly affects the economy
• this is the Short-run aggregate supply curve

  
• if the SRAS curve shifts outwards, levels of inflation will fall. if it shifts inwards, inflation will rise