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This is the question. for the graph stick to the numbers on the graph. Thanks Suppose research has uncovered the following aggregate demand and supply

This is the question. for the graph stick to the numbers on the graph. Thanks

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Suppose research has uncovered the following aggregate demand and supply functions for an economy: AD: P = 80 - 0.05Y AS: P = 40 + 0.05Y a) Draw the AD and AS functions to illustrate the short-run equilibrium real GDP and price. AD 270 240 Price level 60- 30 400 800 1200 1600 2000 2400 Reset Real GDP b) What are the short-run equilibrium values for real GDP and the price level from the graph above? Let us also assume that this short run equilibrium is also the long run equilibrium, that is, Y=Yp. Real GDP = 400 Price level = 60 c) Suppose a fall in demand for new houses reduced the investment component aggregate expenditure, and reduced AD at each price level by 400. Draw the new AD curve in the graph above

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