The long- run aggregate supply curve is
A)vertical.
B)negatively sloped.
C)almost flat.
D)positively sloped at low levels of real GDP and vertical at high levels of real GDP.
E)positively sloped but extremely steep.

Question

Quizplus · Accepted Answer

The long-run aggregate supply curve is vertical because it represents the potential output of an economy that is operating at full employment and with all of its resources being used efficiently. In the long run, changes in input prices do not affect the overall level of output, so the long-run aggregate supply curve is perfectly elastic.

The Long- Run Aggregate Supply Curve Is