Economics practice problem 1

Econ 201 W01 & W02 Summer 2020 Ryan Polla Homework: ASSESS Chapter 11 Homework Score: 0 of 1 pt 7 of 9 (6 complete) I Text Problem 11-16 Consider the figure to the right. Suppose that businesses in this nation initially had been exporting significant amounts of domestically produced goods and services abroad. Assume that other nations of the world have experienced a sudden improvement in economic conditions. What happens to the nation's aggregate demand curve? In the short run, will the nation experience an inflationary gap or a recessionary gap? Explain. LRAS1 1.) Using the line drawing tool, draw a new AD curve that shows the effects of a sudden improvement in economic conditions in other nations. Label your line 'AD2.' AS1 2.) Using the point drawing tool, indicate the economy's new short-run equilibrium price and level of real GDP. Label this point 'E2.' Carefully follow the instructions above, and only draw the required objects. Price Level Real GDP per Year ($ trillions) Click the graph, choose a tool in the palette and follow the instructions to create your graph. Clear All part remaining MacBook Pro