Question: Use an aggregate demand and aggregate supply dia- gram to illustrate and explain how each of the following will affect the equilibrium price level

Use an aggregate demand and aggregate supply dia- gram to illustrate and

Use an aggregate demand and aggregate supply dia- gram to illustrate and explain how each of the following will affect the equilibrium price level and real GDP: a. Consumers expect a recession. b. Foreign income rises. c. Foreign price levels fall. d. Government spending increases. e. Workers expect higher future inflation and negotiate higher wages now. f. Technological improvements increase productivity.

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a Consumers expect a recession When consumers expect a recession their confidence in the economy decreases leading to a decrease in their spending Thi... View full answer

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