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2. Assume a model with a Keynesian downward-sloping aggregate demand and neoclassical aggregate supply curves. Show that the economy starts in a recession. On the

2. Assume a model with a Keynesian downward-sloping aggregate demand and neoclassical aggregate supply curves. Show that the economy starts in a recession. On the same graph, show the effects of expansionary fiscal policy that brings the economy to full employment.

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