1. QUESTION #1
1b) Both Prices & Wages are sticky in the short run which causes QTY supply to rise as inflation
Examples
Price Level ↑ => nominal prices lag => QTY S ↑
Price Level ↑ => nominal wages same but Real Wages ↓ => So Qty Supplied 
1a) P2 E2
1c) Actual Price level at (P1) is LOWER than expected price level (which lags!)
Expected price level lags actual price level in both directions
(actual price level is the one you are graphing => so if AD shifts left => actual falls immediately…)
AD2
1d) Expansionary Fiscal Policy ↓ Taxes & ↑ Gov’t Spending
G ↑ & C ↑ => AD ↑ Back to long run equilibrium

2. QUESTION #1 1f) Tax cuts = less revenue for Gov’t
Government Spending ↑ => more $ going out
Gov’t now running a BUDGET DEFICIT
1g) National Savings Falls
Supply Curve = National Savings = Sum of Public & Private Savings
So Supply shifts left causing real interest rates to ↑
1h) Investment would fall (I↓) as interest rates rise
So AD shifts LEFT

3. QUESTION #2 3d) graph 3a) Demand Curve = Investors (business)
3c) Public savings rises (becomes less negative) so National Savings ↑ 
So Loanable Funds Supply Shifts Right
QUESTION #2
3d) graph
3e) AD ↑ as I ↑ (based only on loanable funds market change)
3f) Increase in Investment ( I↑ ) today mean in the long run:
PPF: Capital Investment shifts PPF to right in long run
SRAS & LRAS: both shift right as PPF went right
UNEMPLOYMENT: r-GDP rises => unemployment rate must fall S2 r2 E2 Q2
3a) Demand Curve = Investors (business)
Investors borrow money for capital goods (I) to
expand business…
3B) Rising Business confidence
Tax Credits for business investment
Both shift D right

4. QUESTION #3
LRAS2
SRAS2 P2 E2 Y2