Define ways of looking at the SRAS curve

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Reference no: EM131832955

Question: a. The short-run aggregate supply (SRAS) curve is very predictable. When inflation is greater than people expect, SRAS eventually shifts (choose one: up, down) over the next year or so, and when inflation is less than people expect, SRAS eventually shifts (choose one: up, down) over the next year or so.

b. Here's another, equally valid way to look at the SRAS curve: When real GDP growth is above the Solow growth rate, SRAS eventually shifts (choose one: right, left) over the next year or so, and when real GDP growth is below the Solow growth rate, SRAS eventually shifts (choose one: right, left) over the next year or so.

c. Explain why the two ways of looking at the SRAS curve are equivalent.

Reference no: EM131832955

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