long run and short run AG suppy
Price :
output:
employment:
wages:
2. There is a decrease in the cost of an input into the production of many goods. Show on one
AD/AS diagram the effect on output and prices in both the short-run and the long-run. Mark the
starting price and output P1 and QN. Mark the price and output at the end of the short-run P2 and
Q2. Mark the price and output at the end of the longrun P3 and Q3. Be sure to label all the lines
on your diagram, and if a line shifts, mark the order of the shifts with subscript numbers after the
symbols (for example, AD1 shifts to AD2 ). Next to the diagram, state the effect on prices,
output, unemployment, and wages in both the short-run and long-run. Assume we start at QN..
long run and short run AG suppyPrice output employment.pdf
1. long run and short run AG suppy
Price :
output:
employment:
wages:
2. There is a decrease in the cost of an input into the production of many goods. Show on one
AD/AS diagram the effect on output and prices in both the short-run and the long-run. Mark the
starting price and output P1 and QN. Mark the price and output at the end of the short-run P2 and
Q2. Mark the price and output at the end of the longrun P3 and Q3. Be sure to label all the lines
on your diagram, and if a line shifts, mark the order of the shifts with subscript numbers after the
symbols (for example, AD1 shifts to AD2 ). Next to the diagram, state the effect on prices,
output, unemployment, and wages in both the short-run and long-run. Assume we start at QN.
