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The US is currently below potential (no need to worry how the US got there). The current nominal interest rate (the Federal Funds Rate) is
The US is currently below potential (no need to worry how the US got there). The current nominal interest rate (the Federal Funds Rate) is 4.75%, which is what the Fed was targeting (Note: The Fed targets the nominal interest rate, but we can translate that into a real rate using Fisher). The February inflation rate was announced to be 6% annually. Using all relevant graphs (KC, S&D of M/P, ISLM, ADAS), illustrate the current state of the US economy. Assume prices are completely sticky in the SR - i.e., a flat SRAS curve. No explanations needed. Label all curves with the subscript "A
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