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HORIZONTAL MERGER: The consolidation under a single ownership of two separately-owned businesses in the same industry. An example of a horizontal merger would be two soft drink companies merging to form a single firm. A horizontal merger should be contrasted with vertical merger--two firms in different stages of the production of one good, such that the output of one business is the input of the other; and conglomerate merger--two firms in totally, completely separate industries.

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Lesson 14: Aggregate Supply | Unit 4: Determinants Page: 12 of 20

Topic: Stability <=PAGE BACK | PAGE NEXT=>

The shifts in the aggregate supply curves are usually small, steady, and readily expected.
  • The supply-side of the aggregate market is usually the perfect picture of stability.
  • Most of economy's instability result from instability on the demand side of the aggregate market.
  • Shifts of the aggregate supply curve are due to ceteris paribus determinants.
  • The supply determinants are things, other than the price level, that affect aggregate supply.
Both, short-run aggregate supply and long-run aggregate supply curves, can increase or decrease.

In both, long run and shot run:

  • An increase shifts the aggregate supply curve to right.
  • It means that producers are willing and able to offer more real production for sale at any and all price levels.
  • A decrease shifts the aggregate supply curve to left.
  • It means that producers are willing and able to offer less real production for sale at any and all price levels.

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EXPORTS LINE

A graphical depiction of the relation between exports sold to the foreign sector and the economy's aggregate level of income or production. This relation is most important for deriving the net exports line, which plays a minor, but growing role in the study of Keynesian economics. An exports line is horizontal which indicates that exports are totally autonomous, with no induced component. The aggregate expenditures line used in Keynesian economics is derived by adding or stacking the net exports line, derived as the difference between the exports line and imports line, onto the consumption line, after adding investment expenditures and government purchases.

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The penny is the only coin minted by the U.S. government in which the "face" on the head looks to the right. All others face left.
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