Question

Macropoland is currently experiencing a recession--consumption and investment are very sluggish, and unemployment is quite high at 9%. Currently, inflation is very low at 0.4% (the historical average rate of inflation is about 2%). The Macropolish President has just hired you as her economic advisor. Your job is to prescribe policy that would enable the economy to recover from the recession. Explain how you could use the standard tools of expansionary monetary policy and expansionary fiscal policy to stimulate this economy towards economic growth.

Develop a response that includes examples and evidence to support your ideas, and which clearly communicates the required message to your audience. Organize your response in a clear and logical manner as appropriate for the genre of writing. Use well-structured sentences, audience-appropriate language, and correct conventions of standard American English.

Answer 1

Answer:-

Since the economy is in doldrums, an arrangement blend of both expansionary financial approach and expansionary monetary strategy is expected to build the general degree of the total interest in the economy. Thinking about the job of government in this situation, expansionary monetary strategy ought to incorporate expanding government spending and lessening the expense rate in the economy.

This will invigorate utilization levels and increment the balance national salary. This thus will likewise raise creation and decrease unemployment as the organizations will enlist more laborers to deliver yield. The general value level will ascend on the economy because of ascend in total interest.

Then again, Fed should bring down loan cost through open market acquisition of the administration protections. This will build cash supply in the economy and lower the pace of premium. The diminished loan cost alongside rising total interest advertisement referenced in above passage will prompt ascent in venture as the business conclusion will turn hopeful sum future desires for the offer of their item. In this way, in general national salary will ascend in the economy.

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