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Static aggregate demand and aggregate supply model

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Reference no: EM131507916

1. Explain how the static aggregate demand and aggregate supply model gives us misleading results about the price level, particularly with respect to decreases in aggregate demand.

2. Describe how the aggregate demand curve is different in the dynamic model as compared to the static model, and describe how potential GDP is different in the dynamic model as compared to the static model.

Reference no: EM131507916

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