Use the following information to work Problems a & b given below. The following events have occurred at times in the history of the United States: (5 Marks)

The world economy goes into an expansion.

U.S. businesses expect future profits to rise.

The government increases its expenditure on goods and services in a time of war or increased international tension.

a.Explain for each event whether it changes short run aggregate supply, long-run aggregate supply, aggregate demand, or some combination of them.