Using the AS- AD Model, Graphically Illustrate and Explain the Short-

question 38

Essay

Using the AS- AD model, graphically illustrate and explain the short- run and medium- run effects of a decrease in productivity. In your graph, clearly label all curves and equilibria. For simplicity, assume that the change in productivity has no effect on aggregate demand.

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Definitions:

Legal Protection

Measures and provisions established by law to safeguard interests, rights, and properties of individuals, organizations, or the society at large.

Brand-name Recognition

Brand-name Recognition is the extent to which a consumer can correctly identify a particular product or service just by viewing the product's logo, tag line, packaging, or advertising campaign.

Trade Secrets

Confidential business information that provides an enterprise with a competitive edge, and is protected from public disclosure.

Time Lag

The delay between the initiation of an action or policy and the observed effects or outcomes of that action.