Today we will learn about long-run aggregate supply. You should have read the text chapter identified below in the homework section and watched the related videos. We will start class today with you working cooperatively with a partner to find a solution to the "Problem of the Day" and then there will be a lecture on our next topic. This page contains all the information you need for today's class: homework, the problem of the day, helpful resources (videos, podcasts, etc.) and an explanation of the activities we will do in class. Use the table of contents on the right to help you navigate.
Read Mankiw (Chapter 25).
Problem of the Day: You will work cooperatively with your partner to construct a response to the following prompt.
Explain the theory of "sticky wages" and why the existence of sticky wages would cause the short-run aggregate supply curve to slope upward.
Explain why the long-run aggregate supply curve is vertical.
Lecture
Related Readings