Question and answer
using expansionary policies to combat a recession would?
Both expansionary monetary policy and expansionary fiscal policy are being used to counter the recession. Expansionary monetary policy is basically just lending more money to people, [ people borrow that money and spend it creating demand in the process. The United States has been using expansionary monetary policy for about 20 years straight now which has directly lead to massive increases in
the levels of debt in the economy. Debt levels are so high now that no one can actually borrow any more so monetary policy has stopped working. Monetary policy is at the most expansionary setting possible right now and it is having effectively no expansionary impact on the economy as a consequence of excessive debt levels. Fiscal policy thus is the only option left available to actually rectify the situation, basically all you are doing is spending money through the government thus creating demand in the economy. Measures being taken include tax cuts (which I personally disagree with under the circumstances as a greater demand impact could be achieved by spending elsewhere like unemployment benefits without the cost of reducing revenue, increased unemployment benefits actually increases govt revenue), other measures being taken include infrastructure spending and extending the length of unemployment benefits. This is basically a Keynesian approach. Keynesian economics revolves around the concept of 'aggregate demand' the government can increase the amount of aggregate demand through government spending. A Keynesian approach is fundamentally the right way to go under the circumstances that exist as this crisis is basically a crisis of demand. ]
Expert answered|badeeani|Points 10|
Question
Asked 9/6/2013 6:14:13 PM
0 Answers/Comments
Get an answer
New answers
Rating

There are no new answers.

Comments

There are no comments.

Add an answer or comment
Log in or sign up first.
18,454,887 questions answered
Popular Conversations
Give the values of a, b, and c from the general form of the equation ...
Weegy: hen the following quadratic equation is written in general form, what is the value of "c"? The formula of ...
11/26/2014 8:05:05 AM| 3 Answers
An object is dropped off a building that is 144 feet tall. After how ...
Weegy: 16t^2 = 144 Simplify, divide both sides by 16 t^2 = 9 t = 3 seconds User: The square of a number exceeds that ...
11/26/2014 8:02:05 AM| 2 Answers
A girl is now one-fourth as old as her father, and in seven years, ...
Weegy: father's age = 20; daughter's age = 5 father's age = 52; daughter's age = 13 father's age = 76; daughter's age = ...
11/26/2014 8:26:45 AM| 2 Answers
. Simplify this expression: 4p + 9 + (–7p) + 2 = ? A. –3p + ...
Weegy: C. s=40 User: Solve this equation: 80 = 3y + 2y + 4 + 1. A. y = 75 B. y = 15 C. y = 1/5 D. y = –15 ...
11/26/2014 8:28:06 AM| 2 Answers
White blood cells contain hemoglobin. (Points : 2) True ...
Weegy: hemoglobin stands for: a hemoprotein composed of globin and heme that gives red blood cells their characteristic ...
11/26/2014 12:44:06 PM| 2 Answers
double marginality
Weegy: According to Nicholas Alex, double marginality is the social burden that African American police officers carry ...
11/26/2014 2:10:01 PM| 2 Answers
If the protagonist tells the story himself, it is told in the ...
Weegy: The story is told in first person if it is told from the protagonist's point of view :)
11/26/2014 2:15:57 PM| 2 Answers
Weegy Stuff
S
L
1
L
P
C
1
P
C
1
L
P
C
1
Points 2814 [Total 14524]| Ratings 10| Comments 2714| Invitations 0|Offline
S
L
Points 1466 [Total 3752]| Ratings 0| Comments 1466| Invitations 0|Offline
S
Points 798 [Total 830]| Ratings 1| Comments 788| Invitations 0|Offline
S
L
Points 777 [Total 1298]| Ratings 6| Comments 717| Invitations 0|Offline
S
1
L
1
L
P
P
L
P
Points 772 [Total 14146]| Ratings 0| Comments 772| Invitations 0|Offline
S
1
L
L
Points 273 [Total 6667]| Ratings 0| Comments 273| Invitations 0|Offline
S
L
Points 162 [Total 1458]| Ratings 3| Comments 132| Invitations 0|Offline
S
Points 86 [Total 86]| Ratings 1| Comments 76| Invitations 0|Offline
S
Points 50 [Total 50]| Ratings 0| Comments 0| Invitations 5|Offline
S
Points 46 [Total 46]| Ratings 3| Comments 6| Invitations 1|Offline
Home | Contact | Blog | About | Terms | Privacy | Social | ©2014 Purple Inc.