Short run AS
- Time too short for wages to adjust to the price level
- Workers may not be aware of changes in their real wages due to inflation and have adjusted their labor supply decisions in wage demands accordingly.
Nominal wages
- The amount of money received per day, per hour or per year.
Real wage
- Wages not estimated in money but purchasing power.
Sticky wages
- Nominal wage level is set according to an initial price level and it does not vary.
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