Unformatted text preview: Consider the case of rising government purchase (G) sharply. Please use the LAS-SAS-AD model to show how this event can generate the demand- pull inflation. [Please show your answer verbally and graphically]. (a) Explain initial effect, money wage rate response and one-time result carefully . (b) Explain Demand-pull inflation proceeds carefully . ...
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This note was uploaded on 09/08/2010 for the course ECON 1A at San Jose State.