Identify whether the following cases mentioned in part 1 to 5 represent an “Aggregate Demand shock” or “Aggregate Supply shock”, graphically sketch the impact of each shock within AD-AS framework, and discuss the role a stabilization policy can play in each case to counter the shock.
Identify whether the following cases mentioned in part 1 to 5 represent an “Aggregate Demand shock” or “Aggregate Supply shock”, graphically sketch the impact of each shock within AD-AS framework, and discuss the role a stabilization policy can play in each case to counter the shock: 1. People living in the economy have become inclined […]