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What Is The Aggregate Supply Function?

2010/7/22 20:06:00 52

Aggregate Supply Function

The aggregate supply function is a function of the relationship between the total price level and the equilibrium output. Y represents the total output in the economy. P means the total price level. The total supply function AS can be expressed as: Y = AS (P).

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What Is The Balance Between Aggregate Demand And Aggregate Supply?

The equilibrium between aggregate demand and aggregate supply is balanced when the aggregate supply is equal to the total demand. At the equilibrium point, the product market and money market that decide the aggregate demand and the labor market that determines the total supply are in equilibrium at the same time.