If suppliers expect goods to sell at much higher prices in the future, they will be less willing to sell in the current period. As a result, the Short Run Aggregate Supply will shift to the left.
Aggregate supply, also known as domestic final supply in economics, is the total supply of goods and services that firms in a national economy intend to sell during a given time period. It is the total amount of goods and services that firms in an economy are willing and able to sell at a given price level.
When demand rises in the face of constant supply, consumers compete for the goods available and, as a result, pay higher prices. This dynamic motivates firms to increase output in order to sell more goods. As a result of the increased supply, prices normalize while output remains elevated.
The aggregate supply curve quantifies the relationship between the price level of goods supplied to the economy and the quantity supplied. In the short term
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