Distinguish between the short-run and long-run aggregate supply curves.
102) What is the affect of a rise in the price level on potential output?
103) Suppose that the sras decreases while AD is held constant. What happens to the price level and output in the short and long run?
104) In the short-run it is possible for output to be affected by governmental policies. Define and explain the three types of output gaps.
105) At a point along the SRAS curve that is to the right of the point where it crosses the LRAS curve, what must be true of the actual unemployment rate relative to the natural rate of unemployment? Why?
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