Assume, coronavirus pandemic has caused major disruption in the global supply chain affecting the supply of critical inputs to production. This has affected the supply side of the Singaporean economy on the large scale.

a.) Illustrate the impact of corona virus-induced supply-side disruption of the Singaporean economy using the AD-AS model. Carefully explain highlighting any special feature of this situation.Assume, the economy was initially in good shape, operating at its potential.

b.) Following this shock to the economy (as described above), indicate the response of the central bank in each of the below referred scenarios, highlighting any trade-off of the central bank's actions.

1. Central bank is concerned about inflation.
2. Central bank is concerned about falling output and rising unemployment.

Explain policy action and associated trade-offs in each of the above scenarios.