COVID-19 hoarding triggers record surge in retail sales, but a payback is coming

By Stephanie Chalmers22 April 2020

https://www.abc.net.au/news/2019-05-07/retail-sales-and-trade-balance-march-2019/11086486?section=business

https://www.abc.net.au/news/2020-04-22/retail-sales-surge-in-march-toilet-paper-rise-pasta-sales-double/12172606

a)Draw an AS-AD diagram for Australia's economy, showing an initial long run equilibrium.

b)Explain the impact of the panic buying in March on output and inflation in the short-run, including showing this on your AS-AD diagram.

c)Looking at each of the aggregate demand components, explain what is the likely impact of COVID_19 on aggregate demand after the panic buying has stopped. Illustrate your answer using a diagram.