Using the AD/AS Model, construct 2 graphs that show how a recession can occur. Explain how discretionary fiscal or monetary policies can be used to move the economy out of recession. Using the AD/AS Model, construct 2 graphs that show how higher rates of inflation can occur. Explain how discretionary fiscal or monetary policies can be used to bring down the inflation rate.
In times of recession what can government do to lessen the economic hardship faced by those who lost their jobs?