Aggregate Demand And Supply

Respond to the following:

In 1973, there was an oil  supply shock created by OPEC (the Organization of the Petroleum  Exporting Countries). Your textbook describes the supply shock as a  source of the recession which lasted from 1973-1975 because it shifted  the US aggregate supply (AS) curve inward to the left, relative to  aggregate demand (AD).

• Now that oil prices  are dropping, use aggregate demand (AD) and aggregate supply (AS) to  explain why this is good for consumers.
• What impact does declining oil prices have on inflation?
• Is there a downside to low oil prices?  Who are the winners and losers in the economy?