econ101fall11lecture8

econ101fall11lecture8 - Shocks to Aggregate Demand &...

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Shocks to Aggregate Demand & Aggregate Supply Required Readings • Chapter 8, pp. 155-159 • Chapter 9, pp. 174-176 & 185 • Chapter 10, pp. 193-199
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Types of Shocks Changes in variables that determine the of the AD curve So fa Aggregate Demand Shocks posit r, these are changes in , , i o on r o CI A Changes in variables that determine the of the AS curve So far, these Aggregate S are change upply S s in hocks position ,, o r K oo o o WZT E
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Aggregate Demand Shocks Changes in variables that shift the AD curve to the Example Positive A s: , , or Intuition: Given , , , or ggregate Demand Shocks-- Right o od CI A P A E Y  Changes in variables that shift the AD curve to the Examples Negative : , , or Intuition: Given , , , or Aggregate Demand Shocks-- Left o A P A E Y 
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Positive Aggregate Demand Shock
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Negative Aggregate Demand Shock
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An Example : I
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Effects on Market Equilibrium An Example : I
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Another Example : I
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Effects on Market Equilibrium Another Example : I
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econ101fall11lecture8 - Shocks to Aggregate Demand &...

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