Definition
- Aggregate supply
- Aggregate supply is the total quantity of output, or real GDP, that firms will produce and sell at each price level.
- Not to be confused with: Aggregate demand
- Aggregate demand is the total spending on a country's domestically produced goods and services at each price level.
Test yourself
What is the difference between aggregate supply and aggregate demand?
Aggregate demand is spending on output at each price level; aggregate supply is the output firms offer at each price level.