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July 7, 2021

Use economic reasoning to explain how and why the pandemic would impact the AD curve

General Questions

In early 2020 the Covid-19 pandemic spread rapidly throughout the US. Assess the macroeconomic impact of the pandemic using the AD-AS model. Specifically, please answer the following questions:

Use economic reasoning to explain how and why the pandemic would impact the AD curve. Please discuss which component (s) of AD are impacted and why. (2 points. I recommend 4 to 6 sentences)
Use economic reasoning to explain how and why the pandemic would impact the SRAS curve. (2 points. I recommend around 4 sentences)
Note (increase, decrease, stay the same) the impact of the pandemic on GDP and Unemployment. No explanation required. (1 point).

This question is worth 5 points. I recommend you spend around 15 minutes on this question.

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