20 18- 16- 14- 12- 10- 8- 6- 4- 2- 0+ 0 10 LRAS ADO SRAS...

 

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20 18- 16- 14- 12- 10- 8- 6- 4- 2- 0+ 0 10 LRAS ADO SRAS 20 30 40 50 60 70 80 90 100 Real GDP (billions of dollars) End of Chapter A.3 Using the line drawing tool, show on the graph to the right the change in the aggregate demand curve that would result from a $5 billion increase in government purchases if the government purchases multiplier equals 2. Label this line AD mut Now on the same graph, show the change in the aggregate demand curve, using the line drawing tool, that would result from the same increase in government purchases if the government purchases multiplier equals 4. Label this line "AD 20 18- 16- 14- 12- 10- 8- 6- 4- 2- 0+ 0 10 LRAS ADO SRAS 20 30 40 50 60 70 80 90 100 Real GDP (billions of dollars) End of Chapter A.3 Using the line drawing tool, show on the graph to the right the change in the aggregate demand curve that would result from a $5 billion increase in government purchases if the government purchases multiplier equals 2. Label this line AD mut Now on the same graph, show the change in the aggregate demand curve, using the line drawing tool, that would result from the same increase in government purchases if the government purchases multiplier equals 4. Label this line "AD

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ANSWER Answer When Multiplier is equal to 2 AD would shif... View the full answer