=+3. An economy is in long-run macroeconomic equilibrium when each of the following aggregate demand shocks occurs.

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=+3. An economy is in long-run macroeconomic equilibrium when each of the following aggregate demand shocks occurs. What kind of gap—inflationary or recessionary—will the economy face after the shock, and what type of fiscal policies would help move the economy back to potential output? How would your recommended fiscal policy shift the aggregate demand curve?

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Economics

ISBN: 9781319066604

5th Edition

Authors: Robin Krugman, Paul Wells

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