2.3.1: Characteristics of AS

• Short run aggregate supply curve slopes upwards, because at higher prices producers are willing to supply more as they can earn more profit
• Movement along SRAS curves is caused by change in price
• SRAS Curve shifts when there are changes in conditions of supply. These are

  Productivity

  Indirect tax

  Number of firms

  Technology

  Subsidies

  Weather

  Costs of Production
• In classical LRAS, the curve is fully vertical, as supply is assumed to not change with price level