Elucidate what happens to real gdp when it is initially

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1)draw a real expenditures curve on a graph showing a recessionary gap. explain what happens to real GDP when it is initially to the right of the equilibrium point and why. Indicate two public policies that would be appropriate for addressing this situation. Explain their impact on your graph.

2) draw a real expenditures curve on a graph showing an inflationary gap. Elucidate what happens to real GDP when it is initially to the right of the equilibrium point and why. Indicate two public policies which would be appropriate for addressing this situation. Explain their impact on your graph.

Reference no: EM1345932

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