S E41: Aggregate Demand & Aggregate Supply
Think Like An Economist
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The Key Idea Behind Aggregate Supply
With a strong economy, that means that nearly every business is producing a lot of stuff. Restaurants are full, factories are running overtime, hotels are oversold and it's difficult for anyone to keep up. So if you're running a car company like ford or general motors, why not raise my prices? After all, i'll sell them at a higher price, which is going to be more profitable.
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