Question: The (AD-AS) Aggregate Demand and Supply ModelModel helps us to understand the key factors that drive inflation, economic growth (GDP), employment and unemployment in the

The (AD-AS) Aggregate Demand and Supply ModelModel helps us to understand the key factors that drive inflation, economic growth (GDP), employment and unemployment in the economy. We have seen that these can all be explained through the interaction of aggregate demand (AD), short-run aggregate supply (AS) and long-run aggregate supply (LRAS).

Is it useful for leaders in Australian businesses, social enterprises and government departments to understand how the economy works? What do you think are the practical benefits of the AD-AS model to senior managers? How do you think the understanding that comes from the AD-AS model could be better utilised in your organisation?

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