The short-run aggregate supply curve is vertical at the natural level of real output.

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve is upward sloping, indicating that as the price level rises, the quantity of goods and services supplied increases. It is the long-run aggregate supply curve that is vertical at the natural level of output, reflecting that in the long run, the total output is determined by the economy's resources, technology, and institutions, not by the price level.

The Short-Run Aggregate Supply Curve Is Vertical at the Natural