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Help me with this question. Not sure of how to draw the graph or answer e) Your Policy Brief team has modelled the effects of

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Help me with this question. Not sure of how to draw the graph or answer

image text in transcribed
e) Your Policy Brief team has modelled the effects of an investment in R&D that lead to the invention of a new production method which make more efficient use of renewable energy sources. This new production method can be disseminated throughout the economy, bring down production costs for businesses, and enabling the economy to make more productive use of existing resources. Illustrate the predicted effects of this innovation using an AD-AS diagram. Provide bullet points to explain what is happening in your diagram. As with all of your diagrams, be sure to indicate the original and new equilibrium points, and what happens to output and price level. To conclude your explanation, explain what is the link between innovation and economic prosperity and wellbeing. Illustration of effect of new renewable energy innovation * Use these bullet points to explain the impacts of this new innovation on the economy, with reference to your AD-AS diagram

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