$(9$ marks$)$

Suppose there is a more optimistic business expectation in an economy.

a$.$ Using the AD$-$AS model with an appropriate diagram, illustrate the short$-$run effects of the more optimistic business expectation.$(3$ marks$)$

b$.$ State how consumption, saving and unemployment would be affected in the short run.

$(3$ marks$)$

c$.$ Explain with the above diagram what the central bank should do if it aims at maintaining price stability.

$(3$ marks$)$