Review Notes - Aggregate Demand and Aggregate Supply

- why is the AD downward sloping (revisited)?

- what causes AD to shift?

- monetary policy

- fiscal policy

- autonomous changes in C, I or net exports

- expectations

- why is the AS upward sloping?

- short-run AS curves

- money illusion

- price lags

- long-run AS curves

- not upward sloping (why not?)

- shifts in AS

- what affects regular supply curves?

- labor (or other resource) market shocks

- expectations of inflation

- government regulation/policy

- monopoly power

- external shocks

- what is the impact of an adverse supply shock in the short and long-run?

- demand pull inflation

- cost push inflation