Thank you.

Assume that the table below shows the unemployment and inflation data in Birdland. Each unemployment rate and its corresponding inflation rate for that same year represent a point on the short-run Phillips Curve. Year Unemployment Rate Inflation Rate 2019 2% 5% 2020 5% 3% 4. Using the data in the table above, draw a correctly labeled graph of the short run Phillips curve for Birdland, showing the actual unemployment and inflation rate for both years. Label this short-run Phillips curve SRPC, and label (with the correct year) each point that you plot on the curve. (5 pts) 5. Assume that the natural rate of unemployment in Birdland is 5 percent. On the graph you drew in #4 above, draw a correctly labeled graph of the long-run Phillips curve and label it LRPC. (3 pts) 6. Now assume that in Birdland, something occurs which shifts the short-run aggregate supply curve to the left. Identify one specific economic event that could cause this SRAS shift. (3 pts) 7. On the graph you drew and used in #4 and #5 above, show how this shift of the SRAS curve would affect the Phillips Curve model. (5 pts) 8. What is the relationship between the unemployment rate and the inflation rate in the long run? (3 pts)9. Above you see the AS-AD model in long-run equilibrium. In words - no need to draw a model - explain what happens to the AS-AD model in the short run and the long run when there is an increase in capital investment. Which curve(s) move(s) in the short run, in which direction? Which curve(s) move(s) in the long run, in which direction? Be clear, specific and thorough for full credit. (7 points)