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Illustrate an initial equilibrium for economy

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The graphs illustrate an initial equilibrium for some economy. Suppose that the economy experiences a fall in aggregate demand (AD). Use the graphs to illustrate the new positions of AD, short-run aggregate supply (SRAS), and long-run aggregate supply (LRAS) as well as the new short-run and long-run equilibria resulting from this change. Assume the government does nothing to offset the drop in aggregate demand.

Reference no: EM133215188

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