Question: E Homework: MyEconLab 8 pan 4 0,4 Consider the diagram to the right. which is drawn under the assumption that the new Keynesian sticky-price

E Homework: MyEconLab 8 " pan 4 0,4 Consider the diagram to the right. which is drawn under the assumption that the new Keynesian sticky-price theory at aggregate supply applies. Assume that at present. the economy is in equilibrium at point A. Answer the following questions. Suppose that there Is a sudden increase in desired investment expenditures. Which oi the allemative aggregate demand curves -AD2 orADa will apply after this event nouns? A03 Other things being equel. in the short run. what will happen to the equilibrium price level: remains unchanged and to equibrium real GDP: Primes Other things being equal. after the event and adjustments dismissed above have taken place. Must will happen tn the equilibrium price level and to equilibrium real GDP in the long run? Price Level 1.) Using the line draMng loci. draw and property label the new aggregate supply curve. 2.) Using the point drawing tool, indicate the new equilibrium price level and new equilibrium real GDP. Labs! the point 15'. Carefully follow the instructions above, and only drew the required objects. N .. 9| Real GDP (5 trillions)

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