1 /(MPS+MRT+MPM)
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Short-run equilibrium
Task: Short run equilibrium occurs where AD=SRAS, this may or may not coincide with the full employment level of equilibrium. If AD or SRAS change then so will the price level and the level of real income/output/GDP. You will be given a packet to show short run equilibrium and some tasks in which you will analyse the impact of various scenarios on the economy using AD/SRAS analysis. Equilibrium in the monetarist/new classical model
Task: These objectives are also addressed in the packet and will be practicing drawing graphs and using them to explain long-run equilibrium positions. Alternative views of aggregate supply - this is where there is controversy...
Once again you will be working from the Aggregate Supply packet to address the objectives above.
The meaning of aggregate supply - we will watch the video above and you will be given a handout to complete
The AD curve
Aggregate demand is the total spending in an economy consisting of consumption, investment, government expenditure and net exports, i.e. the total quantity of output (Real GDP) that all buyers in an economy want to buy at different possible price levels (Average Price Level). There is a packet waiting for you in the Google Classroom.
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