Using Aggregate Demand and Aggregate Supply analysis (including a graph), explain:

1. How a decrease in global demand for iron ore (which Australia is a large exporter of) could cause a recession in Australia, with output below its long-run equilibrium
2. How the economy will move back to long-run equilibrium over time without government intervention
3. How expansionary fiscal policy could be used to move the economy back to long run equilibrium and end the recession sooner

Note: Use the static AD-AS model and assume that the Australian economy is initially at long-run equilibrium.