(a) Assume the economy starts at full employment. Illustrate the short-run and long-run impact of an unexpected monetary contraction using the IS-LM model, the AD-AS model, and the Phillips curve. Be sure to label: i. the axes; ii. the curves; iii. the initial equilibrium values; iv. the direction the curves shift; v. the short-run equilibrium values; and vi. the long-run equilibrium values. Explain in words what your graphs illustrate. )
(a) Assume the economy starts at full employment. Illustrate the short-run and long-run impact of an unexpected monetary contraction using the IS-LM model, the AD-AS model, and the
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