Question: 4 Figure 1: Hayek's (Classical) AD-AS Model Economics Online. (n.d.). Aggregate Demand (AD). Retrieved from http://economicsonline.co.uk/Managing_the_economy/Aggregate_demand.html Figure 2: Keynes's AD-AS Model Economics Online. (n.d.). Aggregate

4 Figure 1: Hayek's (Classical) AD-AS Model Economics Online. (n.d.). Aggregate Demand (AD). Retrieved from http://economicsonline.co.uk/Managing_the_economy/Aggregate_demand.html Figure 2: Keynes's AD-AS Model Economics Online. (n.d.). Aggregate supply (AS). Retrieved from http://www.economicsonline.co.uk/Managing_the_economy/Aggregate supply.html 5. (2 points) The shape of the aggregate supply (AS) curve in the immediate short run is _______ and this reflects _______________. a. Upward sloping, increasing cost of inputs. b. Vertical, the classical school of thought in economics. c. Horizontal, lack of time for adjustments. d. Horizontal, excess capacity

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