The graph below depicts an economy where an increase in aggregate demand has caused inflation. Assume the government decides to conduct fiscal policy by decreasing government purchases to restore fullemployment GDP. Fiscal Policy 160 LRAS 15E] 140 130 12E] 110 100 90 EU 7E] 60 50 40 Price Level U Bil] 160 240 32E] 400 430 560 640 7'20 EDD Real GDP (billions of dollars) Instructions: Enter your answer as a whole number. If you are entering a negative number include a minus sign. a. How much does aggregate demand need to change to restore the economy to its long-run equilibrium? 35 billion b. lfthe lleC is 0.8, how much do government purchases need to change to shift aggregate demand by the amount you found in part a? $- billion Suppose instead that the MPC is 0.?5. c. How much does aggregate demand and government purchases need to change to restore the economy to its longrun equilibrium? Aggregate demand needs to change by $2 billion and government purchases need to change by $- billion