Question 4. Consider an economy that can be represented by the AD-SRAS-LRAS model describe during our course. a) Describe the properties of this economy's long-run equilibrium. Which curves intersect in the long-run equilibrium? What is the equilibrium inflation rate? What is the equilibrium level of output? b) When the economy is at equilibrium, the central bank lowers the nominal interest rate by 3%. Use the model to illustrate what happens to the economy in the short run. Graph the new short-run equilibrium. Then, in words, define the short run and describe how the short-run equilibrium differs from the original equilibrium