SRAS (Short Run Aggregate Supply)

Nominal wages vs. Real and Sticky Wages: 

Nominal wages: amount of money they work or receive per unit of time 

Ex: ( tips waitress makes) 

Real Wages: amount of goods and services a worker can purchase with their nominal wage 

( real wages purchasing power of nominal wages) Determines what you can and can't buy

Sticky Wages-  Nominal wage level is set according to an initial price level and doesn't vary due to labor contracts or other restrictions ( Keynesian) 

		Price	Wages	Employment Level	Implications
Keynesian Range	Recession	Fixed	Fixed	Flexible	Output depends upon changes in employment levels
Intermediate		Flexible	Fixed	Flexible	Output depends upon changes in price and the employment level.
Classical Range	Inflation	Flexible	Flexible	Fixed	Output independent of changes in the price level