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What is the difference between a movement along the SRAS curve and a shift of the SRAS curve?
A movement along the SRAS curve is caused by a change in the price level, while a shift of the SRAS curve is caused by changes in resource prices, government actions, or productivity/technology.
What is SRAS?
The total quantity of goods and services firms are willing and able to produce at various price levels in the short run.
What does 'sticky' wages mean in the context of SRAS?
Wages and resource prices don't adjust immediately to changes in the price level in the short run.
What does a leftward shift of the SRAS curve indicate?
A decrease in aggregate supply, often due to increased resource prices or regulations.
What does a rightward shift of the SRAS curve indicate?
An increase in aggregate supply, often due to technological improvements or decreased resource prices.
On an SRAS graph, what causes movement along the curve?
Changes in the price level.