AP Macroeconomics / Unit 3: National Income and Price Determination
3.4 Long-Run Aggregate Supply (LRAS)
Notes
LRAS is vertical at potential (full-employment) output. It shifts with changes in resources, technology and productivity, the same things that shift the PPC.
Practice
LRAS is vertical because in the long run:
Full employment output.
Better education increasing productivity shifts LRAS:
More potential output.
LRAS is located at:
Potential GDP.
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