Suppose that,because of a large increase in export orders in a hypothetical economy in the year 2001,real GDP follows the path ABCDE in the figure below.Suppose discretionary policy was used,but it was implemented too late.Show how the path in the figure below would change.Show what this looks like using the IA-AD curve analysis.

Question

Quizplus · Accepted Answer

The Answer of Suppose that,because of a large increase in export orders in a hypothetical economy in the year 2001,real GDP follows the path ABCDE in the figure below.Suppose discretionary policy was used,but it was implemented too late.Show how the path in the figure below would change.Show what this looks like using the IA-AD curve analysis.

Suppose That,because of a Large Increase in Export Orders in a Hypothetical