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Chapter 10 Real Gross Domestic Profit and The Price Level in the Long Run

Chapter 10 Real Gross Domestic Profit and The Price Level in the Long Run

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Chapter 10 Real Gross Domestic Profit and The Price Level in the Long Run - Output growth and the long-run aggregate supply curve o Long-run aggregate supply curve Vertical line representing the real output of goods and services after full adjustment has occurred Goods and services measure in base-year dollars It is under conditions of full employment and has reached its potential real gross domestic profit It is the level of gross domestic profit at full employment and we assuming all the variables are constant and stable In long-run consumer price changes are accompanied by corresponding input prices. There will be no incentive for increase or decrease production of gross domestic profit In long-run everyone has full information and there is full adjustment to price level changes o Economic growth and long-run aggregate supply Overtime production possibilities curve increases due to new technology, new capital equipment, and a more efficient labor.
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