Part 1:Changes in which factors could cause aggregate demand to shift from AD to AD1? What could happen to the unemployment rate? What could happen to the inflation rate? Part 2: The Keynesian AD-AS model describes what happens with price levels when aggregate demand increases. Could you find any evidence from the last ten-fifteen years that might support AD-AS model descriptions of demand-pull inflation, cost-push inflation, and recession? For example, you could find data on the GDP’s of any two countries from 2000 to 2017 to support your findings. Please note the followong for the next 3 parts of this. In macroeconomics, the immediate short run is known as a length of time when both input prices and output prices are fixed. In the short-run, input prices are fixed but output prices are variable. In the long run, input prices and output prices can vary. Part 3:What happens in the immediate short-run when AD rises from AD to AD2 to the price level and output?
Thank you so much for your time and effort! Please note that this is a multi part quesition!
Figure 2: Keynes’s AD-AS Model (Image normally goes here)
Part 1:Changes in which factors could cause aggregate demand to shift from AD to AD1? What could happen to the
Part 2: The Keynesian AD-AS model describes what happens with
Please note the followong for the next 3 parts of this. In
Part 3:What happens in the immediate short-run when AD rises from AD to AD2 to the price level and output?
Part 4:What happens in the short-run when AD falls from AD to AD1 to the price level and output?
Part 5:What will happen in each case in the long-run?
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