Use the AS/AD model to explain how the Corona Virus is impacting the US Economy. In...

Use the AS/AD model to explain how the Corona Virus is impacting the US Economy. In your answer, you should discuss the differences between a supply shock and a demand shock. Additionally, you should discuss how supply shocks can lead to demand shocks. You should incorporate a graph of the AS/AD model in your discussion and upload a picture of it.

Your answer should be approximately 250-300 words in length.

Expert Solution

An over-supply of goods in the economy can lead to a fall in prices hence demand shock . This is currently the situation of oil, where Saudi and Russia are producing oil but the consumption has reduced so much due to the lockdown , which has resulted in the fall of oil prices globally .

Rahul Sunny answered 7 months ago

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