Tag: income-output determination

Aggregate supply refers to the sales proceeds from the desired level of output in the economy during an accounting year. Human resources which refers to labor is held to be variable in short run as its application can be changed depending on the requirement of the output in the market. Human resources can be increased or decreased as per the requirement in the market. 

Aggregate supply refers to the desired level of output in the economy during an accounting year. It is through this output only that the producer sector generates income. Therefore, aggregate supply= consumption + savings.

Aggregate supply refers to the sales proceeds from the desired level of output in the economy during an accounting year. It is through this output only that the producer sector generates income in the economy at any given level of employment. Therefore, aggregate supply= consumption + savings.

Natural resources which a determinant of aggregate supply also known as land in economics refers to all the natural gifts which are present in the nature including air, water and land that can be used in the production process for the production of desired level of output in the economy. 

Capital refers to the amount which is been invested by the owners of the firm which is used to employ people to work in the production process and also to acquire assets which is used in the production process, Therefore, he aggregate supply and employment depends on the quality and use of this stock of capital because if it is not used efficiently then it will not yield the desired level of output. 

The productive efficiency of labour and capital increases with the use of technology as it refers to the technical way of doing something in a more efficient and easy manner with discovery of some new techniques which increases the efficiency in production when mixed with other factors of production.