Business, 30.07.2020 23:01 briannagiddens

Suppose that the U. S. economy has a recessionary gap and the world economy goes into an expansion. Explain the effect of the expansion on U. S. real GDP and unemployment in the short run. U. S. potential GDP is $16.0 trillion. Draw a line to indicate potential GDP. Label it. The U. S. economy has a recessionary gap. Draw the aggregate demand curve. Label it AD1. Draw the aggregate supply curve. Label it AS1. Draw a point at the macroeconomic equilibrium. Label it 1. The world economy goes into an expansion. Draw a curve to show the effect of the world expansion on the U. S. economy. Label it. Draw a point at the new macroeconomic equilibrium. Label it 2.

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Suppose that the U. S. economy has a recessionary gap and the world economy goes into an expansion....

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