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Based on Your Understanding of the AS- AD Model and the IS-

question 12

Essay

Based on your understanding of the AS- AD model and the IS- LM model, graphically illustrate and explain what effect a decrease in the price target will have on the economy. In your graphs, clearly illustrate the short- run and medium- run equilibria.


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The process of electronically exchanging brief messages, usually between two cell phones.

Instant Messaging

A form of real-time communication between two or more people based on typed text over the internet or a network.

Business Communication

The sharing of information between individuals within and outside an organization for commercial benefits.

Inverted Pyramid

The Inverted Pyramid is a writing style where the most important information is presented at the beginning, gradually tapering to the lesser crucial details.

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