The aggregate supply (AS)curve is drawn with which variables on the axes of the graph?
A)the price level on the vertical axis and MPC on the horizontal axis
B)national income on the vertical axis and total desired consumption on the horizontal axis
C)the price level on the vertical axis and real GDP on the horizontal axis
D)national income on the vertical axis and marginal cost on the horizontal axis
E)the price level on the vertical axis and real disposable income on the horizontal axis

Question

Quizplus · Accepted Answer

The aggregate supply (AS) curve shows the relationship between the price level and the amount of real GDP that firms in the economy are willing and able to supply. Therefore, the AS curve is drawn with the price level on the vertical axis and real GDP on the horizontal axis.

The Aggregate Supply (AS)curve Is Drawn with Which Variables on the Axes