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The graphs illustrate an initial equilibrium for some economy. Suppose that the economy experiences a fall in aggregate demand (AD). Use the graphs to illustrate

The graphs illustrate an initial equilibrium for some economy. Suppose that the economy experiences a fall in aggregate demand (AD). Use the graphs to illustrate the new positions of AD, shortrun aggregate supply (SRAS), and longrun aggregate supply (LRAS) as well as the new shortrun and longrun equilibria resulting from this change. Assume the government does nothing to offset the drop in aggregatedemand.

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