Assume that the long-run aggregate supply curve is vertical at Y = 3,000 while the short-run aggregate supply curve is horizontal at P = 1.0. The aggregate demand curve is Y = 3(M/P) and M = 1,000.a.If the economy is initially in long-run equilibrium, what are the values of P and Y?Illustrate your answers in a diagram.b.  Now suppose a supply shock moves the short-run aggregate supply curve to P = 1.5. What are the new short-run P and Y? I llustrate your answers in a diagram?c.  If the aggregate demand curve and long-run aggregate supply curve are unchanged, what are the long-run equilibrium P and Y after the supply shock? I llustrate your answers in a diagram?d. Suppose that after the supply shock the central bank wanted to hold output at its long-run level. What level of M would be required? If this level of M were maintained, what would be long-run equilibrium P and Y? I llustrate your answers in a diagram?The post Equilibrium 19931767 appeared first on nursingwritinghelp.org. “Are you looking for this answer? We can Help click Order Now”  “Looking for a Similar Assignment? writersThe post Equilibrium 19931767 first appeared on nursing writers.   “Are you looking for this answer? We can Help click Order Now”

 

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