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Assignment:
Construct a diagram for the economy using? AD, SRAS, and? LRAS, where the economy has a SR equilibrium of Actual Unemployment? = U? = 7%, and with a Price Level? = 97.? (Assume the Natural Rate of Unemployment =5%)
Label all? curves, axis, and relevant equilibrium points using provided info.
?Follow-up short answer? question:
?- Refer to your prior short answer to the Aggregate? Supply& Demand scenario to complete this question.
?- Assume the President and Congress decides to use the two tools of discretionary fiscal policy to restore? LR/SR equilibrium.
?- Explain the two tools of discrectionary fiscal? policy, and how they each contribute to restoring equilibrium. Clearly relate tools to the components and effects on AS and AD.
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