Draw the following four graphs with an economy experiencing an inflationary gap: money market, investment demand, aggregate demand and supply (with the LRAS), and the Phillips curve. Show what happens in the short-run on all three graphs when the central bank decreases the money supply.
Draw the following four graphs with an economy experiencing an inflationary gap: money market, investment demand, aggregate demand and supply (with the LRAS), and the Phillips curve. Show what happens in the short-run on all three graphs when the central bank decreases the money supply.
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![b. Draw the following four graphs with an economy experiencing an inflationary gap: money market,
investment demand, aggregate demand and supply (with the LRAS), and the Phillips curve. Show
what happens in the short-run on all three graphs when the central bank decreases the money supply.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd7b3a5a8-62f8-422a-9e49-23846b36685e%2F9b5dcc62-62b5-4363-8050-f44bb7fdb49e%2Fn7z70gi_processed.png&w=3840&q=75)
Transcribed Image Text:b. Draw the following four graphs with an economy experiencing an inflationary gap: money market,
investment demand, aggregate demand and supply (with the LRAS), and the Phillips curve. Show
what happens in the short-run on all three graphs when the central bank decreases the money supply.
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