What phase of production does the upward sloping aggregate supply curve represent?

The upward sloping aggregate supply curve represents the short-run phase of production. In the short-run, as the overall price level increases, firms tend to produce more goods and services. This occurs because higher prices can lead to higher revenues, encouraging firms to hire additional resources and increase output to meet the demand driven by those prices.

This relationship is reflected in the upward slope of the aggregate supply curve in the short run. In contrast, in the long run, the aggregate supply curve is vertical, indicating that output is determined by factors such as technology and resource availability, rather than the price level. The equilibrium phase refers to the point where aggregate demand equals aggregate supply, while recession refers to a period of declining economic activity, which does not specifically describe the upward movement of the aggregate supply curve. Thus, the correct answer emphasizes the behavior of firms in response to price changes within the short-run framework of production.