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Question 12 1 pts On the far right side of the AS curve, the economy is producing potential, and on the far left of the curve
Question 5 1 pts On the far left side of the AS curve, the economy is producing, potential, and on the far right of the curve

I do not know what is diferrence between them
plz give me help ASAP


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Answer #1

Question 12:

Answer: above, below.

Explanation: We are talking about a short-run supply curve (SRAS- curve). On the far left side of it, the output level of the economy is far below the potential GDP. Even a slight increase in prices will induce sellers to employ more factors of production and produce more output. Thus the steep increase in the AS curve, which will become almost vertical at the far right side. Here the economy is producing above its potential GDP - by employing all factors overtime due to high levels of profits. This only happens in the short run.

Question 5:

Answer: below, above.

Note: There is no difference between the two questions except that the order of the right and the left side is inverted in the statement.

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