Th2.3: Long-run AS

Question 1

In the short run, supply can be increased by offering overtime, but in the long run…

Answer 1

there will be a limit on how much supply can be increased

Question 2

What happens to supply once labour productivity is maximised?

Answer 2

supply cannot be increased any further

Question 3

How does the LRAS curve differ from the SRAS regarding wage rates?

Answer 3

wage rates are variable and can change

Question 4

What are the two different types of long run aggregate supply curve?

Answer 4

classical

Keynesian