The graphs show aggregate demand (AD), longrun aggregate supply (LRAS), and shortrun aggregate supply (SRAS). Suppose a housing bubble burst deteriorates consumers' expectations about the future. As a result, aggregate demand shifts to the location shown in the graphs.

In the without government intervention graph, shift the appropriate curve or curves to describe how the economy will move towards a new longrun equilibrium if the government does not intervene. In the with government intervention graph, shift the appropriate curve or curves to describe how the economy will move towards a new longrun equilibrium if the government promptly intervenes through fiscalpolicy.

The graphs show aggregate demand (AD). longrun aggregate supplyr fLRAS}. and shortrun aggregate supply (SEAS). Suppose a housing bubble burst deteriorates consumers' expectations about the future. As a result, aggregate demand shifts to the location shown in the graphs. In the without government intervention graph, shift the appropriate curve or curves to describe how the economy will move towards a new longrun equilibrium if the government does not intervene. In the with government intervention graph. shift the appropriate curve or curves to describe how the economy will move towards a new longrun equilibrium it the government promptly intervenes through scal policy. Without government intervention With government intervention Long-run aggregate supply Price level Price level S ortru'n aggregate Suppl}? \"\\ggrcgale demand Short-run aggregate supply WEBER dlnd