Which of the following is true of the short-run aggregate supply curve?
A)It shows the relation between the inflation rate and the quantity of aggregate output firms supply,other things constant.
B)It shows the relation between the price of labor and the aggregate quantity of labor workers supply,other things constant.
C)It shows the relation between the interest rate and the quantity of capital goods firms supply,other things constant.
D)It shows the relation between the price level and the quantity of aggregate output firms supply,other things constant.
E)It shows an inverse relationship between the price level and real GDP.

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve shows the relationship between the price level and the quantity of aggregate output firms are willing to supply, holding other factors constant. In other words, it shows the amount of goods and services that firms are willing to sell at different price levels in the short run. Factors held constant may include input prices, technology, and production processes.

Which of the Following Is True of the Short-Run Aggregate