02/18/16             Aggregate Supply:

• The level of Real GDP (GDPr) that firms will produce at Price Level (PL)

Short Run- Level of GDPr  which is directly related to the price level.

                 - where input prices are sticky and do not adjust to the price level

Long Run- input prices are flexible, and adjust to changes in price level

                 -GDPr independent of price level