Definition
The short-run aggregate supply (SRAS) curve shows the relationship between the overall price level and the quantity of real output firms produce in the short run, when some input prices (like wages) are sticky.
Why It Matters
SRAS is key to explaining short-run inflation-output trade-offs and how shocks affect the economy.
Example
A rise in the price level may lead firms to increase output in the short run if wages do not adjust immediately.