4. Suppose that new technology makes it easier for producers to produce.

a. Will this new technology affect Aggregate Demand or Aggregate Supply? Justify your answer.

b. Use Aggregate Demand-Aggregate Supply analysis to predict the impact of this change in technology on U.S. GDP, unemployment rate, and inflation. . Explain your answer in words. Your explanation should include a description of the process by which the economy moves to a new equilibrium.

c. Illustrate your answer in a properly drawn and labeled Aggregate Demand - Aggregate Supply graph. As much as possible, indicate changes in equilibrium GDP, unemployment rate, and inflation rate (you do not have to submit the graph electronically, but you should be able to draw it). Explain words what your graph shows.