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Ultimate Flashcard Review
Video
Long-Run Aggregate Supply
Key Concepts to Understand
Question 1 of 4
The long-run aggregate supply (LRAS) curve is vertical because:
the government can always adjust its spending to maintain full employment.
in the long run, the price level is fixed by the central bank.
in the long run, wages and other input prices are flexible and fully adjust to changes in the price level.
the multiplier effect is stronger in the long run than in the short run.
Practice Questions: Test Your Understanding
Apply what you've learned with these practice questions. These questions test your understanding of the key concepts.
Question 1 of 3
Refer to the graph below. A rightward shift of the Long-Run Aggregate Supply (LRAS) curve from LRAS1 to LRAS2 is best explained by:
An increase in the quantity or quality of productive resources.
A decrease in the price level.
An increase in aggregate demand.
A decrease in the natural rate of unemployment.
Expansionary monetary policy.
Key Takeaways
- 📊Master the fundamentals: Understanding these core concepts is essential for success in AP Economics.
- ✅Practice makes perfect: Use the interactive exercises and practice questions to reinforce your understanding.