Cards (4)

  • How does a change in the cost of raw materials affect short run AS?
    If the costs of production rise, AS will decrease
  • How does a change in exchange rates affect short run AS?
    If the exchange rate of the pound increases against other currencies than imports become cheaper and AS will increase
  • How does a change in tax rates affect short run AS?
    If there is a decrease in employers tax contributions, AS will increase
  • How does a change in level of tariffs affect short run AS?
    If a country increases tariffs on its imports than the costs for firms increases, meaning AS will decrease