Draw a dynamic aggregate demand and aggregate supply graph show... | Filo

SOLVED:Draw a basic aggregate demand and aggregate supply graph (with LRAS constant) that shows the economy in long-run equilibrium. a. Assume that there is a large increase in demand for U.S. exports. Show the resulting short-run equilibrium on your graph. In this short-run equilibrium, is the unemployment rate likely to be higher or lower than it was before the increase in exports? Briefly explain. Explain how the economy adjusts back to long-run equilibrium. When the economy has adjusted back

SOLVED: Draw a basic aggregate demand and aggregate supply graph (with LRAS constant) that shows the economy in long-run equilibrium.a. Assume that there is a large increase in demand for U.S. exports. Show the resulting short-run equilibrium on your graph. In this short-un equilibrium, is the unemployment rate likely to be higher or lower than it was before the increase in exports? Briefly explain. Explain how the economy adjusts back to long-run equilibrium. When the economy has adjusted back

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The economy is in short-run macroeconomic equilibrium at point ... | Filo

The economy is in short-run macroeconomic equilibrium at point E1 in the accompanying diagram. Based on the diagram, answer the following questions. a. Is the economy facing an inflationary or a recessionary gap? b. What policies can the government implement that might bring the economy back to long-run macroeconomic equilibrium? Illustrate with a diagram. c. If the government did not intervene to close this gap, would the economy return to long-run macroeconomic equilibrium? Explain and illustr