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Experiencing demand-pull inflation and a positive output gap

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Reference no: EM132603479

Suppose the Fed has observed the economy is experiencing Demand-Pull inflation and a positive output gap. Discuss the monetary policy process and tools that can be used to address an inflationary output gap. Depict graphically the impact of these policy actions in the AD-AS model. What happens to the equilibrium price level and output level? This question requires graphing, graphs may be produced digitally or simply hand-drawn, photographed, and attached with assignment submission.

Reference no: EM132603479

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