Use the keynesian ad-as model

Reference no: EM13812598

Use the Keynesian AD-AS model to answer the following questions.

Draw the effects of a recession caused by a decease in aggregate demand. For simplicity, assume that your economy starts at general equilibrium.

Assume you are chairman of the Fed. What are your two options? When would each policy be the optimal option?

Draw the effects of both of these options (graph) and explain in words

Reference no: EM13812598

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