Business, 11.05.2021 19:10 tiiia

Assume that as a result of the coronavirus and U. S. (Federal) Government policies to ameliorate or lessen the virus’ public health impact, the U. S. unemployment increases from 3.6% to 13.7% by May, 2020. As part of monetary and fiscal policies, however, beginning in the summer of 2020 the Fed purchases over $3.5 Trillion in U. S. government bonds and Federal Government transfers $5,000 to every U. S. adult over 18 years old (not in college…. sorry) financed by government debt. Then, as a part of its overall public health policies, the U. S. government begins to relax or loosen its previous travel and "shutter in" policies in the Spring 2021 so that people can now go to restaurants, movies or sporting events and the like more freely. Absent increases in the United States long run aggregate supply, the combined economic effects of such policies would most likely be: A. Lower interest rates. B. Higher unemployment rates consistent with the crowding out effect. C. Lower GDP growth. D. Higher rates of inflation.

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Assume that as a result of the coronavirus and U. S. (Federal) Government policies to ameliorate or...

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