From what I gathered and could understand, the short run aggregate supply represents a short-run relationship between price level and output supplied. In the short run input prices remain fixed and when the price level rises the output level rises. The same can be said if the price level falls, the output level falls or less output is produced. An economy can achieve short-run equilibrium when the aggregate amount of output demanded is equal to the aggregate amount of output supplied, which is when AD and AS curves interest.

The long run aggregate supply is the output an economy can produce when all resources are beingutilized and operating at full employment.When the AD and AS intersects at the full level of employment (when the unemployment rate in the economy is equal the natural rate of employment), the long run aggregate supply will achieve equilibrium and can occur at any price level.In all, the economy is at both short-run and long-run equilibrium when all three curves AD, AS, and LRAS intersect at the full employment level of output.

Do you agree or disagree with the discussion?