2. The crucial difference between how the economy works in the long run and how it works...

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2. The crucial difference between how the economy works in the long run and how it works in the short run is that prices are flexible in the long run but sticky in the short run. The model of aggregate supply and aggregate demand provides a framework to analyze economic fluctuations and see how the impact of policies and events varies over different time horizons. LOP8

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Macroeconomics And The Financial System

ISBN: 9781429253673

1st Edition

Authors: N. Gregory Mankiw, Laurence Ball

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