Question: 4. Assume instead that the positive demand shock emerging in period 1 lasts for two periods before it dies out. Illustrate the effects graphically. Will

4. Assume instead that the positive demand shock emerging in period 1 lasts for two periods before it dies out. Illustrate the effects graphically. Will the fluctuations in output and inflation be larger or smaller than those occurring when the shock lasts for only one period? Explain

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