ABC is a relatively small but prosperous country with a thriving labor market, mostly medium income households and less than 10% of the population is retired. The country recently reported the following information from their 2018 - 2022 (1st qtr.) economic report. The country's unemployment rate was 3.8% year over year from 2018 to 2021 and the projected expectation is that unemployment will remain relatively stable for the next 2 yrs. (approx.). ABC country's economic output was approx. $1 bio. In 2018, $70 mio. in. 2019 and $50 mio. in 2021. Prior to the pandemic the country was reporting uneven growth made worse by low economic activity during 3rd qtr. 2019 to 2021. The government's economic advisors have determined that it is in the country's best interests to focus on exports of natural resources to become competitive and grow the country's exports.

(a) Use the aggregate demand/supply module to illustrate the impact of moderate/slow economic growth. Address how unemployment and inflation impact country's growth concerns from 2019 - present. Assess how shifts in AD/AS may lead to dramatic shifts in the country's market place. Include two macroeconomic reasons to support your response. (ref. ch. 24/section 5.2 and 5.3). (ref. Figure 24.10).

(b) Based on the given information, how would you describe the country's GDP for 2018 - 2021? Is there a correlation between the country's output to GDP in 2018 to 2021? Include two macro reasons to support your response. Is there any indication that ABC country is producing output more or less than its potential GDP? Include one example to support your explanation.

(c) One concern with the economic advice on exports of natural resources is ABC country has a high cost of business investment. Which two major macroeconomic factors should the country consider before implementing any change to the high cost of business investment? Explain each factor and include an economic or financial setback that could derail the business investment.

(d) Explain why the factors you chose in (c) are important to the ABC country's economic success in the short and long term (i.e. present to year 2025). Analyze how these factors could potentially affect the country's trade deficit (if any), and/or trade surplus (if any). Consider the positive effect of a trade surplus on ABC's economy in the long term as well as the effect of a trade deficit on ABC's economy in the short term.

Note: This question is based on the parameters of an emerging market country that assume stable government, free market and integrated in the global financial system.