The SRAS becomes steeper as the economy approaches the full employment level.

Name: The SRAS becomes steeper as the economy approaches the full employment level.
Brand: Quizplus
Rating: 4.8 (55 reviews)

Question

Quizplus · Accepted Answer

This is because as the economy approaches full employment, there are fewer idle resources in the economy, and firms must increase prices to attract and retain workers. This results in a higher cost of production and a decrease in the quantity supplied at any given price level, leading to a steeper SRAS curve.

The SRAS Becomes Steeper as the Economy Approaches the Full