Question: Use a dynamic aggregate demand and aggregate supply graph to illustrate the change in macroeconomic equilibrium from 2021 to 2022, assuming that the economy experiences

Use a dynamic aggregate demand and aggregate supply graph to illustrate the change in macroeconomic equilibrium from 2021 to 2022, assuming that the economy experiences deflation during 2022. In order for deflation to take place in 2022, does the economy also have to be experiencing a recession? Briefly explain.

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The economy does not have to be in a recession during 2022 for deflation to take place As is shown ... View full answer

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