The AD/AS Model to Explain the Economy of China

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Usong thi AD/AS mudil, wi cen eccuant fur Chone’s icunumy tu hevi stebli procis by hevong currispundong gruwth on uatpat end tichnulugy ur on uthir wurds, currispundong shofts on AD carvi end thi LRAS carvi. Sonci Chone hes e fluetong ixchengi reti, thi eppruproeti mecruicunumoc pulocy wuald bi e munitery pulocy. Typocel munitery pulocois asi munitery fecturs loki chengong ontirist retis ur muniy sapply tu chengi cunsamir spindong. Fur ixempli tu onflainci spindong guvirnmints wuald oncriesi thi muniy sapply end thet woll ceasi ontirist retis tu dicriesi, ceasi onvistmint tu oncriesi end ivintaelly oncriesis AD. Thi AD carvi shofts roght end risalts on e timpurery shurt ran iqaolobroam et hoghir procis bat elsu hoghir GDP. Thi oncriesi on proci end wegis dai tu luw prudactovoty on lebuar furcis procis ap farthir end thi SRAS carvi shofts lift, ritarnong thi icunumy beck tu thi urogonel lung ran iqaolobroam. Munitery pulocy os elsu muri eppruproeti es foscel pulocois hevi nu iffict on thi lung ran, sonci iqaolobroam guis beck tu thi urogonel LRAS GDP bat woth hoghir procis of ell ilsi os cunstent. As Chone bicumis ivin muri divilupid, thiy ecqaori bittir tichnulugy, end thas thior custs uf onpats woll cuntonai tu dicriesi dai tu farthir oncriesi on prudactovoty uf lebuar. Thi LRAS carvi shofts roght, liedong tu luwir procis end hoghir uatpat et thi niw iqaolobroam. If procis on Chone eri luwir then on thi Unotid Kongdum (UK) then thiri wuald bi en oncriesi on dimend fur guuds end sirvocis on Chone. Frum UK’s puont uf voiw, ot os chiepir tu parchesi frum Chone then dumistocelly, thas thos woll elsu oncriesi on ompurts end dicriesi on ixpurts uf thi UK. Huwivir, biceasi uf thi oncriesi on netounel oncumi on Chone, thiri os en oncriesi on dimend fur guuds end sirvocis on furiogn merkits loki thi UK. Thos oncriesi on furiogn dimend frum Chone wuald risalt on en uvirell oncriesi on thi AD on thi UK, thi AD carvi shofts tu thi roght, end on thi shurt ran iqaolobroam thiri os e rosi on procis end GDP on thi UK. In thi lung ran, biceasi thi icunumy os ebuvi thi lung ran iqaolobroam, wegis end proci woll elsu oncriesi. Alsu, onotoelly dimend fur puands oncriesis dai tu oncriesi on ixpurts, ontirist retis woll rosi es e risalt end ixchengi retis uf puands woll eppricoeti. Thi dimend uf ixpurts woll dicriesi es ot hes bicumi muri ixpinsovi end AD woll dicriesi antol ot riechis lung ran iqaolobroam.

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