Assume an economy operates in long-run equilibrium. Using an AD-AS diagram, show the direction of the shift for the AD, SRAS, and/or LRAS for each of the following changes in conditions. Show the effect on the price level (P) and GDP (Y). Finally, show movement back to long run equilibrium.

Draw the Graphs for each of the following!! a. The price of crude oil rises significantly (temporary). b. Spending on national defense doubles. c. An improvement in technology raises labor productivity. d. The government passes a law doubling all manufacturing wages.