Long-Run Self-Adjustment

It argues that prices and wages are completely flexible: this would look like a vertical AS curve (no SRAS or LRAS), and changes in AD are going to have automatically adjusted prices and wages.
With long-run self-adjustment, businesses and workers adjust their prices and wages to bring back equilibrium
The LRAS does not move in the self-adjustment scenarios -only with changes in land, labor, capital and tech.
If the AD curve exceeds the equilibrium point, the SRAS curve will shift left, to bring it back to the LRAS, but at a higher PL

In a recession, an economy is operating at an output below full capacity.
Workers may accept lower wages due to lay offs and having to make a living.
Businesses are not selling as much, so they may decrease prices
When they both happen, SRAS increases, resulting in a decrease in inflation and unemployment.

An inflationary gap is when the economy is overreaching, and is beyond capacity
When workers are working more they get paid more
Businesses will see a big demand for goods and increase their prices
Increases in prices and wages will shift SRAS to the left, increasing inflation, and unemployment