Stabilization Policy and the Speed of Adjustment. Economists who believe the transition from the short run to the long run occurs rapidly do not generally favor using active stabilization policy. Use...

Stabilization Policy and the Speed of Adjustment. Economists who believe the transition from the short run to the long run occurs rapidly do not generally favor using active stabilization policy. Use the aggregate demand and aggregate supply graphs to illustrate how active policy, with a rapid adjustment process, could destabilize the economy