5. Given the following graph and assuming that the economy is in equilibrium, calculate the inflationary or recessionary gap if

a) potential GDP (LAS) is $600

b) potential GDP (LAS) is $800 Price

c) potential GDP (LAS) is $900 Index Aggregate Quantity Demanded ($)

Aggregate Quantity Supplied ($)

90 1200 950 95 1150 1025 100 1100 1100 105 1050 1150 110 1000 1190 115 950 1220

a) What is the equilibrium level of prices and real GDP?

b) If the price level were 95, would there be a shortage or surplus? How much? What if the price level was 115?