Which of the following statements is correct?
A)The classical aggregate supply schedule is horizontal while the Keynesian aggregate supply schedule slopes upward to the left.
B)The classical aggregate supply schedule is vertical while the Keynesian aggregate supply schedule is horizontal.
C)The classical aggregate supply schedule is vertical while the Keynesian aggregate supply schedule slopes upward to the right.
D)The classical aggregate supply schedule slopes upward to the right while the Keynesian aggregate supply schedule is vertical.
E)none of the above are correct.

Question

Quizplus · Accepted Answer

In classical economics, the aggregate supply is vertical, indicating that output is determined by factors of production and is not influenced by the price level. In Keynesian economics, the aggregate supply curve is upward sloping to the right, reflecting that output can increase with higher demand and prices, especially in the short run.

Which of the Following Statements Is Correct