Question

1) If a country’s economy expreriences a shift causing the AD curve to move to the...

1) If a country’s economy expreriences a shift causing the AD curve to move to the right, what will the short run impact be to real GDP and the price level ? What will be the impact in the long run to real GDP and the price level ?

2) why ma the actual multiplier experienced by changes in the fiscal policy differ from the expected multiplier ?
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Answer #1

Q.1.

The question is understood having look at the following diagram from 'Essentials of Economics'

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