In France, potential GDP is 3 000 billion Euros. The following table shows Japan's aggregate demand and short-run aggregate supply schedules.

Price level Real GDP demanded (billions of euros) Real GDP supplied in the short-run (billions of euros)

80 3400 3000

90 3300 3100

100 3200 3200

110 3100 3300

120 3000 3400

130 2900 3500

140 2800 3600

a)Draw a graph of the aggregate demand, short-run aggregate supply and long-run aggregate supply curves.

b)What are the short-run equilibrium real GDP and price level?

c)Does France have an inflationary gap or a recessionary gap and what is its magnitude?

d)Explain what will happen in the long-run.

e)What are the long-run equilibrium real GDP and price level?