Use the AD/AS model to illustrate what happens to United States equilibrium GDP and the price...

Use the AD/AS model to illustrate what happens to United States equilibrium GDP and the price level under the following scenarios. Also state what happens to national income and unemployment.

1. Canada, the number one destination of U.S. exports, goes into recession.

2. Energy prices rise throughout the economy.

3. Wages fall throughout the economy.

4. Congress passes a law lowering the income tax.

5. Businesses become more optimistic and raise their forecast ROI.

Include a caption! Beside or below each graph, explain why you shifted the curve.

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Expert Solution

Rahul Sunny answered 1 year ago

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