35. In 2007, the U.S. Economy slipped into recession. The GDP dropped by more than 4 %, inflation stayed fairly low, and the unemployment rate rose to above 10%.

As an economic adviser to the Congress and the Federal Reserve, what would you suggest Congress should do with its tools of fiscal policy, and what would you propose that the Fed do with its tools of monetary policy?

Write a paragraph explaining your recommendations, being sure to describe how the tools will work to help improve aggregate demand.

Question

35. In 2007, the U.S. Economy slipped into recession. The GDP dropped by more than 4 %, inflation stayed fairly low, and the unemployment rate rose to above 10%.

As an economic adviser to the Congress and the Federal Reserve, what would you suggest Congress should do with its tools of fiscal policy, and what would you propose that the Fed do with its tools of monetary policy?

Write a paragraph explaining your recommendations, being sure to describe how the tools will work to help improve aggregate demand.