Aggregate Supply and the AD/AS Model

What this note covers

1. The AD/AS Framework: Purpose and Structure
2. Aggregate Demand: Determinants and the Downward Slope
3. Short-Run Aggregate Supply: Shape, Slope, and Shift Factors
4. Long-Run Aggregate Supply: Potential GDP and Productivity Factors
5. Macroeconomic Equilibrium in the AD/AS Model
6. Demand-Side Shocks: Causes, Effects, and Policy Responses
7. Supply-Side Shocks: Stagflation, Favourable Shocks, and Long-Run Implications

7 sections · 14 key terms & formulas · 6 common mistakes