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Assuming an economy operates in the intermediate range of its aggregate supply curve. State the direction of shift for the aggregate demand on aggregate supply
Assuming an economy operates in the intermediate range of its aggregate supply curve. State the direction of shift for the aggregate demand on aggregate supply curve for each of the following changes and see what is the effect on the price level? On real GDP? On employment?
A. The price of crude oil rises significantly.
B. Spending on national defense doubles.
C. The costs of imported goods increase.
D. An improvement in technology raises labor productivity.
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