Explain how each of the following will affect the economy, by analyzing each case in an SRAS-AD diagram and determine in each case the effects on real GDP and the general price level:
a. The interest rates are raised by the Fed.
b. “Fracking” for gas and oil expands, and oil & energy prices in the U.S. fall.
c. The stock market soars and American wealth expands significantly.
d. The government cuts government spending on transfer payments.
e. Many labor unions demand, and get, large wage-increases.