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Suppose that there is a positive aggregate demand shock. Which graph most accurately shows how this would affect the aggregate demand - aggregate supply model? Note that the new curve is shown in gray.




 
Hint

Suppose that there is a negative aggregate demand shock. Which graph most accurately shows how this would affect aggregate demand - aggregate supply model. Note that the new curve is shown in gray.




 
Hint

Suppose that we observe decrease in taxes. Which graph most accurately shows how this would affect aggregate demand - aggregate supply model. Note that the new curve is shown in gray.





 
Hint

Suppose that we observe fall in income. Which graph most accurately shows how this would affect the aggregate demand - aggregate supply model? Note that the new curve is shown in gray.





 
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