|
|
RESOURCE: The labor, capital, land, and entrepreneurship used by society to produce consumer satisfying goods and services. Land provides the basic raw materials--vegetation, animals, minerals, fossil fuels--that are inputs into the production of goods (natural resources). Labor is the resource that does the "hands on" work of transforming raw materials into goods. Capital is the comprehensive term for the vast array of tools, equipment, buildings, and vehicles used in production. Entrepreneurship is the resource that undertakes the risk of bringing the other resources together and initiating the production process.
Visit the GLOSS*arama
|
|
|
|
|
Lesson 16: Aggregate Shocks | Unit 4: Complex Shifts
|
Page: 14 of 21
|
The case of an increase in the AD curve. Let's start at long-run equilibrium. All three curves, AD, LRAS, and SRAS, intersect at the same long-run equilibrium values, Po and Qf.- With a rightward shift of the AD curve, the aggregate market achieves short-run equilibrium at a higher price level and more real production.
- The labor market imbalance causes wages and production cost to rise. The SRAS shifts leftward. It stops shifting when it intersects the new AD and the original LRAS curves for a new long-run equilibrium. The price level is even higher and real production returns to full employment.
|
|
|
|
|
|
|
AVERAGE FACTOR COST Total factor cost per unit of factor input employed by a firm in the production of output, found by dividing total factor cost by the quantity of factor input. Average factor cost, abbreviated AFC, is generally equal to the factor price. However, using the longer term average factor cost makes it easier to see the connection to related terms, including total factor cost and marginal factor cost.
Complete Entry | Visit the WEB*pedia |
|
|
BEIGE MUNDORTLE
[What's This?]
Today, you are likely to spend a great deal of time flipping through the yellow pages wanting to buy either a replacement washer for your kitchen faucet or a stretchable, flexible watch band. Be on the lookout for slightly overweight pizza delivery guys.
Your Complete Scope
This isn't me! What am I?
|
|
|
Francis Bacon (1561-1626), a champion of the scientific method, died when he caught a severe cold while attempting to preserve a chicken by filling it with snow.
|
|
|
"The past is a foreign country; they do things differently there." -- Leslie Poles Hartley, Writer
|
|
JF
Journal of Finance
|
|
|
Tell us what you think about AmosWEB. Like what you see? Have suggestions for improvements? Let us know. Click the User Feedback link.
User Feedback
|
|
