(Solved): The following graph shows an aggregate demand (AD) curve and a short-run aggregate supply (SRAS) c ...

The following graph shows an aggregate demand (AD) curve and a short-run aggregate supply (SRAS) curve for an economy. Suppose that the economy is initially in a short-run equilibrium: at \( P_{E} \), and Real GDP is 20 billion. Suppose that at some point, the price decreases to \( P^{*} \). At \( P^{*} \), there is of billion goods. As a result, the price level , firms output, and consumers consumption.