Consider the AD/AS Model

question 115

Multiple Choice

Consider the AD/AS model.Since output in the long run is determined by Y*,the only role of the AD curve is to determine the price level.This is true because

• A)Y* is independent of the price level.
• B)the aggregate demand curve is vertical.
• C)the aggregate demand curve is horizontal.
• D)Y* depends on the price level.
• E)the AS curve is upward sloping.

---

Definitions:

Resources and Capabilities

The tangible and intangible assets that a firm utilizes to develop, manufacture, and deliver products or services to its customers.

Sustainable Advantage

An enduring benefit or competitive edge that a company can maintain over its competitors, often through innovation or strategic resource management.

Supplier Power

The ability of providers of goods or services to drive up prices and dictate terms because of their importance or scarcity.

Critical Inputs

Essential resources or factors required in the production process or for the delivery of a service that significantly impact the quality and output of the final product.