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Unformatted text preview: represented graphically in Figure 12. In figure 12, quantity supplied has been measured along horizontal axis and price level has been shown on the vertical axis. Because of the direct relation between the two, the supply curve O-AS is continuously rising upwards. However, there is an important difference in the behavior between individual and aggregate supply curves. An individual supply curve is moderately steep throughout. But in case of aggregate supply curve, two distinct phases are noticeable. Initially the AS curve is flatter and rises upwards only gradually . In the figure ON is such an initial phase. But later on the AS curve becomes steeper and finally becomes a vertical straight line. In the figure, N-AS is such steeper phase....
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- Fall '10