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Short-run aggregate supply (SRAS)

NB While AD is the same whether in the Short Run or in the Long Run: AS (SRAS) in the Short Run is distinguished from  AS (LRAS) in the Long Run. This is because of the definitions of the Long Run and the Short Run for a whole economy.

The Short Run for the economy is defined as when there are fixed variables such as infrastructure and technology (LRAS shifters)

Syllabus: Define the term aggregate supply.

 Aggregate Supply is defined as the total amount of planned production over a given period of time.
(Again note the important use of the word planned)

Syllabus: Explain, using a diagram, why the short-run aggregate supply curve (SRAS curve) is upward sloping.

This is explained in the interactive diagram below:

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