The Aggregate Supply Curve That Defines the Level of Full

question 88

Multiple Choice

The aggregate supply curve that defines the level of full employment or potential output based on a given amount of resources,efficiency,and technology in the economy is called:

• A)short-aggregate supply curve.
• B)long-run aggregate supply curve.
• C)intermediate aggregate supply curve.
• D)none of the above.

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Definitions:

Labor Supply

The total hours that workers wish to work at a given real wage rate, reflecting how individuals divide their time between labor and leisure.

Capital

Financial assets or the monetary value of physical assets such as buildings or machinery used by a business to produce goods or services.

Marginal Product

The additional output produced as a result of adding one more unit of a specific input, keeping all other inputs constant.

Additional Output

The extra quantity of output produced as a result of increasing the level of input by one unit.