The 2 models you have used have different underlying assumptions.

• Outline the major underlying difference(s) between the two models.(AD-AS and AE model)
• Briefly discuss and illustrate how thehow the difference(s) in the model assumptions impact the degreeof the potential impact on the economy. Use the AD-AS Model and provideONEdiagram to illustrate the potential difference in outcomes depending on the assumptions made. (Hint - consider the assumptions underlying the AE model - what SRAS curve reflects this?)