2.3.3

Question 1

Keynesian LRAS

Answer 1

-Keynesian view suggests that the price level of an economy is fixed until resources are fully employed

Question 2

Classical LRAS

Answer 2

This view suggests that output is fixed at each level
All factors of production in the economy are fully employed in the long run

Question 3

Factors affecting LRAS

Answer 3

• influenced by changes which affect the quantity/ quality of the factors of production
• technological advances
• changes in relative productivity
• changes in education and skills
• changes in government regulation
• demographic changes and migration
• competition policy