Suppose That the Economy of Umbria Is Initially at Full-Employment

Essay

Suppose that the economy of Umbria is initially at full-employment equilibrium.Explain,in terms of shifts in AD or AS,how the following results could occur:
a)Real GDP increases;the price level decreases;the economy is experiencing an inflationary gap.
b)Real GDP increases;the price level increases;the economy is experiencing an inflationary gap.
c)Real GDP increases;the price level decreases;the economy is experiencing a recessionary gap.
d)Real GDP decreases;the price level increases;the economy is experiencing a recessionary gap.
e)Real GDP decreases;the price level increases;the economy is experiencing an inflationary gap.