In the late 1990s a growing number of economists argued that world policymakers were focusing too...

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In the late 1990s a growing number of economists argued that world policymakers were focusing too much on fighting inflation. The economists also argued that the technical level of potential output had risen. Show their argument using the AS/AD model

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In the late 1990s a growing number of economists argued that world policymakers were focusing too much on fighting inflation. The economists also argued that the technical level of potential output had risen. Show their argument using the AS/AD model
http://usa.usembassy.de/etexts/oecon/chap7.htm 
The Ad ASs model shows how eqb GDP and price level are determined in the economy. 
The AD is a down sloping curve that shows the relation between prices and total dd made by all economic agents. This total dd comprises of Consumption dd(C), Investment dd(I), Government dd (G) and net exports demand (NX= exports – imports) AD= C+I+G+NX . Higher prices will cause lower demand, which makes AD negatively sloped. 
The AS can be seen in three parts. In the long run,

In the late 1990s a growing number of economists argued that world policymakers were focusing too much on fighting inflation. The economists also argued that the technical level of potential output...

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