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Aggregate demand-aggregate supply model

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Reference no: EM131518014

Answer the following questions, and explain what would happen to the aggregate demand-aggregate supply model when appropriate.

a. Explain what an aggregate demand-aggregate supply model looks like in the long run equilibrium. 

b. What happens on your model when aggregate demand increases. (i.e is there a shift or movement?)

c. Is the economy you modeled in an expansion or recession now?

d. Continuing with the economy you are building, what type of monetary policy would you suggest be taken by the Federal Reserve?

e. What will your suggested policy do to your aggregate demand-aggregate supply model in the short run?

Reference no: EM131518014

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