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2.. If the economy is operating in the short run AS curve and aggregate demand falls, what is likely to happen to real GDP, P
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Short run AS is upward sloping and the AD is downward sloping. If AD falls then the Price will fall and so will the quantity. The real GDP (Y) will fall. With a fall in the real GDP the employment will also fall. And hence the unemployment will rise. The economy will face a recessionary gap as the output sold in the economy is below its short run capacity as shown below.

PL LAS SRAS PLEC PLAY AD AD Yo te GDP LP

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