Q3 (10 marks) Assume that an economy is initially at its full employment equilibrium. A large positive demand shock then occurs. a) On an aggregate demand (AD)/aggregate supply (AS) diagram, illustrate the economy's transition from its initial equilibrium to its new long run equilibrium if policymakers implement stabilisation policy in response to this shock. (4 marks) b) Carefully, in words, explain how this transition occurs distinguishing between the short run and long run. (4 marks) c) With the aid of a central bank reaction function diagram, explain the role of the central bank in this transition. (2 marks)