a. Draw a graph of the aggregate demand curve and the short-run aggregate supply curve.
b. What is the short-run equilibrium real GDP and price level?
In Japan, potential GDP is 600 trillion yen. The table shows the aggregate demand and short-run aggregate supply schedules.

Transcribed Image Text:

Real GDP demanded Real GDP supplied in the short run Price level 75 85 95 105 115 125 135 trillions o 600 550 500 450 400 350 300 400 450 500 550 600 650 700