You are the chair of the Federal Reserve when, because of sudden loss of consumer confidence, there is a recession. i) Which target would you focus? ii) What kind of policy would you pursue? iii) Which tools would you use, and how? iv) How would you expect your efforts to effect the economy? (use the AS/AD-IS/LM model)

Market Watch, May 24, 2018 discusses, "what happens if the oil rally turns into an 'oil shock' ". Graphically show the short- and long-term impact of this using the AD-AS model.

Between 2007 and 2009, the United States experienced a severe financial crisis and economic downturn commonly known as the Great Recession. Starting in 2006, housing values fell 30%, causing losses in mortgage-backed securities for families and financial institutions. The recession was marked by a drop in aggregate demand that caused a decline in GDP and an increase in unemployment. Attached is an example of an aggregate demand and aggregate supply (AD/AS) model that illustrates the general trends of the U.S. economy during the Great Recession. How did the AD/AS equilibrium change over time? Support your claims by referring to your AD/AS model. Select an economic factor (GDP, unemployment, price level) and explain what impact any shifts in AD or AS (or both) had on your chosen factor. Please tailor the answer according the AD/AS model in layman's terms

Consider an economy currently in recession. Which is NOT a policy move that could assist the economy, as discussed in class? Raising the money supply Raising government spending Lowering bank reserves Lowering interest rates

Please see below. These are true or false questions. 1). The aggregate supply curve will shift left as the price of key inputs rises, and will shift out to the right if the price of key inputs falls. 2). Long-term economic growth is illustrated in the AD/AS framework by a gradual shift of the aggregate supply curve to the left.

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let's consider the AS/AD model. furthermore, assume two events happen at the same time: government conducts contractionary fiscal policy and the global price of energy (oil) falls. show the effects of these two events in a graph and explain what will happen to the GDP and price level?

Which do you believe is the better macroeconomic policy to use for stabilizing (achieving potential GDP and controlling inflation) the economy - Monetary or Fiscal? SUPPORT your stance (for example, if you believe fiscal policy is better than monetary policy, explain how fiscal policy (pros) achieves these objectives better than monetary policy (cons)).

Q#1: [40 pts] (a) Draw an AS/AD graph. Assume that in your graph GDP* = 1,000 (million) and inf* = 8%. Put these values on your graph. If this graph represents the US economy, explain what major problem you see with this equilibrium. (b) Assume that mpc = 0.90 and the US government is considering two options for economic policy [see below]. Draw a graph for each option. Show the change in equilibrium and label the now

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