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in the short run, how does this event affect country b's economy, such as overall price level, real gdp and unemployment? what is the economic term for this situation? please briefly describe how that will be reflected in the ad-as diagram.

Answer :

The short run in macroeconomics is a period in which wages and some other prices are sticky.

The aggregate demand/aggregate supply, or AD/AS, model is one of the fundamental tools in economics because it provides an overall framework for bringing economic factors together in one diagram.

We can examine two different types of unemployment using an AD/AS diagram—cyclical unemployment and the natural rate of unemployment. Cyclical unemployment bounces up and down according to the short-run movements of GDP. The long-term, baseline level of unemployment that occurs year in and year out, however, is called the natural rate of unemployment.

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