Answer to Question #227307 in Macroeconomics for Madushika Nilmini

Question

List some empirical examples to support each theory which explains why the short-run aggregate supply curve is upward sloping

Answer 1

The short-run aggregate supply curve is upward sloping, as the quantity supplied increases as the price rises. In the short run, firms have only one fixed factor of production (usually capital ). The curve shifts outward at a given price, increasing output and real GDP.