In macroeconomic modelling,as price flexibility increases ________.
A)the short-run aggregate supply schedule will get flatter
B)the short-run aggregate supply schedule will get steeper
C)the short-run aggregate supply schedule will shift to the right
D)the short-run aggregate supply schedule will shift to the left

Question

Quizplus · Accepted Answer

As price flexibility increases, the short-run aggregate supply (SRAS) schedule becomes steeper. This is because with greater price flexibility, firms can adjust their prices more readily in response to changes in demand, leading to less variation in output and a steeper SRAS curve.

In Macroeconomic Modelling,as Price Flexibility Increases ________