In the mid-1990s, the Taliban seized power in Afghanistan after 18 years of war and proclaimed a fundamentalist Muslim state. This strict Muslim state existed until the Taliban government was overthrown in 2002 by the U.S. military and the Northern Alliance. As part of the Muslim principles as interpreted by the ruling clerics, women’s activities were severely restricted. Women and girls were forbidden to go to offices and schools. The restriction on gainful employment was particularly painful for women who were sole supporters of their families. After 18 years of war, there were many fewer men to support families.

It was estimated that women made up 10 percent of the labor force before the Taliban seized power so that the prohibition on women working reduced the labor force by 10 percent.

What would have happened to real GDP and the price level after the Taliban took over Afghanistan? Explain using aggregate demand–aggregate supply analysis.