Suppose the multiplier is 5 and the government increases its purchases by AED 20 billion.Also, suppose the AD curve would shift from AD1to AD2if there werenocrowding out; the AD curve actually shifts from AD1to AD3withcrowding out. Also, suppose the horizontal distance between the curves AD1and AD3is AED 40 billion. Estimate the extent of crowding out, for any particular level of the price. ( Show your work)

P AD2 AD 3 AD 1 Suppose the multiplier is 5 and the government increases its purchases by AED 20 billion. Also, suppose the AD curve would shift from AD, to AD2 if there were no crowding out; the AD curve actually shifts from AD, to AD; with crowding out. Also, suppose the horizontal distance between the curves AD, and AD, is AED 40 billion. Estimate the extent of crowding out, for any particular level of the price. ( Show your work)