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Use the Aggregate Demand and Aggregate Supply model to analyze the impacts of the following events,...

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Economics

Use the Aggregate Demand and Aggregate Supply model to analyzethe impacts of the following events, show this on a graph for eachsituation.

1) Steelworkers go on strike and produce less steel.

2) US Senators read about the glories of the Internet and sodemand for high tech government purchases increases.

3) A series of Investment Banks such as Lehman Bros and BearSterns go bankrupt,

Answer & Explanation Solved by verified expert
4.1 Ratings (479 Votes)
In all graphs initial equilibrium is at point A where AD0aggregate demand and SRAS0 shortrun aggregate supply curvesintersect with initial equilibrium price level P0 and initialequilibrium real    See Answer
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