The figure given below shows the aggregate demand curve and the short-run aggregate supply curve of an economy.The Fed can return the economy depicted by this figure to its potential output in the long run by:
Definitions:
Amount Invested
The total sum of funds or assets placed into investments such as stocks, bonds, or real estate, by an individual or entity.
Investment Date
The specific date on which an investment is made or an asset is purchased.
Capital Investment Decisions
Decisions made by businesses regarding which major projects or investments to undertake, considering potential returns and risks.
Long-Term Commitment
An obligation that extends beyond the current fiscal year, often related to contracts, investments, or financial agreements.
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