7) Aggregate Supply

• Describe the short-run AS curve:

  Upwards sloping
• Describe the long-run AS curve:

  A straight line
• Describe the Keynesian AS curve:

  Initially horizontal, then upwards sloping, then vertical
• What is the difference between the short and long run AS curves?

  • Short-run: All factors other than labour are fixed
  • Long-run: All factors of production are fixed