C) The two factors which will influence both Short. run and Long run are Environmentalfunds and health care funds. Due to increased spendingin both these departments, there will be both short. term and long term growth. In short. term, however, Aggregate supply curve will shift outwards or rightwards due to increased money supply. This shiftingof money supply will raise price and output. Similarly, increase in Aggregate demand will shift demand curve to right raising price and quantity. In long run, AS and AD are only affected by Labor Capital and Technology. AS will be vertical implying that change in AD will only temporarily changes economy's output. In longrun, Supply is always constant and increase in demand will lead to only increase in price. D) Below full employment is when economy is in recessionary gap and all of its resources including some labor capital andtechnology are not fully employed. Inthat case, economy's actual GDP will be less than Potential GDP. Government's Fiscal policies can lead economy back to its normal position by cutting taxes or increased govt. spending. In this case increased spending in public service will lead to economy back to full employment. The real or potential GDP can be calculated by followingformula: If government increase "G" it will lead to an increase in "C' which will push economy back to long run equilibrium. The change in AD will be towards right due to increase in government spendingand increased consumer spending. AS will be vertical because Supply is constant during long run