Use an aggregate demand and aggregate supply graph to illustrate the situation where equilibrium initially occurs with

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Use an aggregate demand and aggregate supply graph to illustrate the situation where equilibrium initially occurs with real GDP equal to potential GDP and then the aggregate demand curve shifts to the left. What actions can Congress and the president take to move real GDP back to potential GDP? Show the results of these actions on your graph. Assume that the LRAS curve doesn't shift.

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Economics

ISBN: 978-0134106243

6th edition

Authors: R. Glenn Hubbard

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