Hello all, hope you’re all on track… I have the following question: The aggregate supply curve becomes more stepper as the economy is running at full production, the curve becomes inelastic due to the amount of limited resources. Now the issue i’m having is that a limited or non-renewable resource is considered to have a perfertly Elastic supply curve, why is that? one would assume it to have the same as the AS? Thanks
Ok, got it…reread the passage…supply is elastic at the present value of next years price.