- (12 pts.) The U.S. economy has fallen into a recession. The unemployment rate is 8% and is expected to increase. The inflation rate is -2.4%, meaning overall, prices are falling. Mr.Bill has suggested the following to policy makers:
-Fiscal Policy- increase government spending and lower income taxes.
-Monetary Policy- increase the money supply by buying bonds in order to increase interest rates.
Do you agree or disagree with Mr.Bill's suggestions for both fiscal and monetary policy. Support your answer.
I agree with Mr.Bill on both... View the full answer