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In: Economics

This project challenges you to critically discuss fiscal and monetary policies as well as their combined...

This project challenges you to critically discuss fiscal and monetary policies as well as their combined use in the IS/LM model. To do so, first, carefully study the textbook Focus on "The US recession of 2001," and think through the effectiveness of the policy mix adopted to aid recovery. Second, consider the possibility that the US would slip into a hypothetical recession now: argue on the basis of your understanding of IS/LM and the current US macroeconomic trajectory for a specific fiscal and monetary policy response.

In summary, write

  • one (roughly) 100 word paragraph on your assessment of the 2001 recession, and
  • one (roughly) 100 word paragraph on your recommended policy response to a hypothetical recession in the next quarter!

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Expert Solution

Rahul Sunny answered 2 years ago
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