Question

Briefly explain the reason for the near-vertical shape of the SRAS curve on its far right.

Short answer

The reasons why the SRAS curve is near vertical on its far-right are given below.

Step-by-step solution

Step 1. Definition

The SRAS (short-run aggregate supply) curve is a curve that shows that if there is an increase in price level and you will be moving along the SRAS, there will be an increase in the amount of real GDP which will be produced in an economy.

Step 2. Explanation

On its far-right, the SRAS curve is vertical because the main reason is that the economy is doing great and operating at its full capacity.it does not matter what the price levels are because companies are not able to produce more, the reason is that they (workers and companies) already working with their full capability.