Real GDP Suppose the recent volcanic events in Iceland, which disrupted European air travel significantly, represented just the beginning In other words, suppose that experts predict a world-wide...

Real GDP

Suppose the recent volcanic events in Iceland, which

disrupted European air travel significantly, represented just the beginning In

other words, suppose that experts predict a world-wide series of huge eruptions

from active volcanoes The Yellowstone caldera is anticipated to be the

largest–the caldera is roughly 30 miles by 40 miles

Use the AD/AS model to describe what will happen in the

short run and long run to the world real GDP and the price level Moreover,

describe what policymakers could do after this has happened