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Illustrate the Short-Run and Long-Run Impact of an Unexpected Monetary

Question 65

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Illustrate the short-run and long-run impact of an unexpected monetary contraction using both the AD-AS model and the Phillips curve. Assume the economy starts at full employment. Illustrate the short-run and long-run impact of an unexpected monetary contraction using both the AD-AS model and the Phillips curve. Assume the economy starts at full employment.

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In the AD-AS model, the unexpected monet...

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