The Question Assume an economy that is operating above full employment. A. Draw a correctly labeled aggregate demand and aggregate supply graph and show each of the following: . The longmn aggregate supply curve I . Current price level and output levels, labeled PLe and Ye M . Full employment output, labeled Yf B. Identify one scal policy action that could resolve the problem. C. Using your graph in Part A, show the shortrun effects of the action you identied on each of the following: . Aggregate demand. Explain (use the cause and effect chain you learned in the lesson) I . Output ll . Price level D. Using a correctly labeled loanable funds graph, show the effect of the policy you identified in Part B on real interest rates. E. Given the change in the real interest rate in Part D, what is the impact on each of the following? . Investment | . Economic growth rate. Explain. ll . The international value ofthe dollar. Explain. F. Now assume instead that the government takes no policy action to x the problem identied in part A. . In the long run, will the shortrun aggregate supply increase, decrease, or remain unchanged? Explain