Part 2: Short Answer Questions (30 points) Problem 3: Short run and long run economic analysis (20 points) Suppose that the government temporarily increases income tar, which decreases households ' incentive to consume. Consider the impact of this event on the short run economy and long run economy using the ADXAS model. Draw here the following the AD/AS diagram. Assume, for the sake of your graphs, that the economy begins in the long run equilibrium (i.e._., the output equals to potential output), denoted as point A. Show the starting pointA and the short run equilibrium pointA ' that occurs due to the increase in income tax. Draw and label your graphs carefully showing the short run effect of the increase in income tax. (10 points)