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SAVINGS AND LOAN ASSOCIATION: A depository institution chartered by the Federal Home Loan Bank that was established to assist home owners with low-cost mortgage loans using savings deposits. However, S&Ls have expanded their activities and now provide most of the services of traditional banks, including checkable deposits.

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Lesson 14: Aggregate Supply | Unit 3: The Curves Page: 9 of 20

Topic: Short Run <=PAGE BACK | PAGE NEXT=>

The short-run aggregate supply (SRAS) curve captures the relationship between the price level and the aggregate supply of real production in the short run.
  • GDP deflator, the price level, is measured on the vertical axis. Real GDP, the real production, is measured on the horizontal axis.

Highlights:

  • The SRAS is a positively-sloped line.
  • The positive slope means that higher price levels correspond to greater levels of real production.
  • With rigid prices, the price level does affect the aggregate supply of real production in the short run.

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CAPITAL ACCOUNT, BALANCE OF PAYMENTS

A subset of the balance of payments accounts that tracks the flow of currency and other monetary assets used to purchase financial and physical assets. This part of balance of payments tracks domestic investment in the foreign sector and foreign investment in the domestic sector. This is one of two primary subsets of the balance of payments. The other is the current account. A deficit or surplus in the capital account is matched by an opposite surplus deficit in the current account.

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