The economy is in long-run equilibrium when the short-run aggregate supply curve, aggregate demand curve, and long-run aggregate supply curve are in equilibrium. What are the major factors causing a shift in aggregate demand (inward or outward)?What are the major factors that will affect short-run aggregate supply? Long-run aggregate supply? Review what factors will lead to a shift in the AD, SAS, and LRAS. An increase in output due to economic growth will increase both short-run and long-run aggregate supply. Unanticipated changes in either aggregate demand or aggregate supply will disrupt long-run equilibrium and cause current output to differ from the economys long-run potential.
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