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Suppose an economy has an inflationary gap. a. Illustrate this using a graph with LRAS, SRAS, and AD curves. Identify the equilibrium price level, real GDP, and the output gap in your
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22.3 Recessionary and Inflationary Gaps and Long-Run Macroeconomic Equilibrium – Principles of Economics
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Show a graph using AD-AS with recession equilibrium (recessionary gap). What kind of fiscal and monetary policies will be used to fix this gap? Show the graphical effect of these policies. What
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