Why does an AS curve have three ranges?

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1128891

2026-04-30 01:20

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The AS curve has three ranges because of different levels of responsiveness of output to changes in price level. In the short run, firms may not be able to adjust prices quickly, leading to a horizontal range. In the intermediate range, firms can adjust prices and output, resulting in a positive sloping range. In the long run, all inputs can be adjusted, leading to a vertical range.

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