Question: Use the table and grid below to answer the following questions:
a. In the grid, graph the aggregate demand and aggregate supply curves (label them AD0 and AS0). What is equilibrium output and the price level?
b. Assume aggregate demand grows by 100% (doubles; so that output doubles at each price level). Graph the new aggregate demand curve and label it AD1. What is the new equilibrium output and price level?
c. If full employment output is 600, what will be the long-run output and price level given the new aggregate demand curve?
