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QUESTION 1 Sketch AD-AS diagram depicting an economy away from long-run equilibrium (inflationary situation). Indicate the economy's short run equilibrium point. Discuss how the classical

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QUESTION 1 Sketch AD-AS diagram depicting an economy away from long-run equilibrium (inflationary situation). Indicate the economy's short run equilibrium point. Discuss how the classical adjustment to long-run equilibrium can be reached and illustrate the process in your diagram

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