Aggregate Supply (AS) curve: The Aggregate Supply (AS) curve shows the relationship between overall price levels and total output supplied in an economy. It represents how businesses respond to changes in prices, wages, and production costs.
Multiplier effect: The multiplier effect refers to the amplification of initial changes in spending through the economy. When aggregate demand increases, it leads to higher production, income, and employment, creating a positive feedback loop.
Sticky prices: Sticky prices refer to situations where prices do not adjust quickly or easily to changes in supply or demand. This can affect how quickly an economy responds to shocks and adjusts its equilibrium level of output.