Question: Using ISLM analysis explain what would cause the aggregate demand
Using ISLM analysis, explain what would cause the aggregate demand curve to be steep.
Relevant QuestionsWhat would cause (a) a steep ADI curve; (b) a gently sloping ADI curve? Compare the short-run and longrun effects of (i) a temporary adverse supply shock and (ii) a permanent supply reduction under each of (a) and (b).What factors determine the effectiveness of discretionary fiscal policy?Compare the relative merits of targeting (a) The money supply; (b) The exchange rate; (c) The rate of inflation.For what reasons do countries experience very different long-run rates of economic growth from each other?What is the relationship between ‘successful’supply-sidepolicies and unemployment in (i) the short run and (ii) the long run, according to (a) Keynesian and(b) Monetarist assumption?
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