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SLOPE, LONG-RUN AGGREGATE SUPPLY CURVE: The long-run aggregate supply (LRAS) curve is a vertical line with an infinite slope, reflecting the independent relation between the price level and aggregate real production. A higher price level is associated with the same real production as a lower price level. And this real production is that produced when resources are fully employed, that is, full-employment production. Real production is unaffected by the price level because prices are flexible in the long run. Long-run price flexibility ensures that ALL markets (product, financial, and resource) are in equilibrium.
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REAL-BALANCE EFFECT A change in aggregate expenditures on real production made by the household, business, government, and foreign sectors that results because a change in the price level alters the purchasing power of money. This is one of three effects underlying the negative slope of the aggregate demand curve associated with a movement along the aggregate demand curve and a change in aggregate expenditures. The other two are interest-rate effect and net-export effect. The real-balance effect is somewhat analogous to the income effect underlying the negative slope of the market demand curve.
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WHITE GULLIBON
[What's This?]
Today, you are likely to spend a great deal of time lost in your local discount super center wanting to buy either storage boxes for your computer software CDs or a set of tires. Be on the lookout for slow moving vehicles with darkened windows.
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This isn't me! What am I?
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Junk bonds are so called because they have a better than 50% chance of default, carrying a Standard & Poor's rating of CC or lower.
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"There is no twilight zone of honesty in business. A thing is right or it's wrong. It's black or it's white. " -- John F. Dodge, automaker
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ARCH
Autoregressive Conditional Heteroskedasticity
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