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Tutorial 8 Qns 1
Transcript of Tutorial 8 Qns 1
Nguyen Thi Loan
Nguyen Thi Ngoc Quy
Heng Kuan Yi Zhong Yangzhi
Ng Wee Yang
Joel Wong Tutorial 8 Presentation Question 1(Q.3,Page 297) By using aggregate supply and demand curves to illustrate your points, discuss the impacts of the following events on the price level and on equilibrium GDP(Y) in the short run b. An increase in the money supply during a period of high unemployment and excess industrial capacity Part A Part B Part C Part D i)AD will fall due to increase in T and decrease in G
(AD1 to AD2)
ii)AD will rise as Fed will use i/r to increase I thus increasing output
(AD2 to AD1)