The market adjustment mechanism in the long run
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Q1: Draw the AS-AD diagram on the first scenario (demand shock).
Q1: Draw the AS-AD diagram on the first scenario (demand shock).
Q2: Draw the AS-AD diagram on the second scenario (temporary supply shock).
Q2: Draw the AS-AD diagram on the second scenario (temporary supply shock).
Q3: Draw the AS-AD diagram on the third scenario (permanent supply shock).
Q3: Draw the AS-AD diagram on the third scenario (permanent supply shock).
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