1. The expenditure multiplier basically tells us how well the amount of government spending actually affects the economy. The size of this matters so that we can access if the spending is worth it. This matters to a multitude of people because the expenditure multiplier has to do with GDP, informing business how well they are reaching their customers, and so on. When the Great Recession, the government passed the American Recovery and Reinvestment act of 2009, which included spending $800 to return the economy to its better state. As bad as the Great Recession was, this action does seem to be warranted, and a good decision. The government began creating tax-cuts, giving food stamps and unemployment insurance as part of the fiscal stimulus, and this appears to have done its part in rebuilding the economy, so I'd say it was just right. Sources around the internet claim that these stimuli were beneficial for the economy.

In 2020, the COVID-19 hit, severely damaging the economy. We saw lows that we hadn't seen in years, and the economy suffered. Similar actions were taken in order to restore the economy, and we are still building ourselves back up. This article This article points out the multiple similarities and differences between the Great Recession beginning in 2007 and the Coronavirus Recession of 2020.

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2. With the size of expenditure convey the info about how much income, output, and employment will increase as a result of increase in expenditure. If there is a small increase in the expenditure than a high value of multiplier will imply and lead to a larger increase in output and employment. With a smaller multiplier means a lower increase in output and employment following the increase in expenditure. It matters to businesses for when they need to know how much a change in demand is expected in expenditure to make production decisions. It matters to all employees, consumers, and policy makers, as just like for them it helps increase economic activities and bring economy out of recession. The multiplier effect also has a positive impact and with the government during the recession followed an expansionary fiscal policy, which followed an increased public spending. The government took appropriate measures and would not be able to directly handle the situation without the necessary being done by the government. On another note, the recession was just enough that it controlled it and the fact that it increased the spending, it did not result in an inflation and rapidly increasing the growth rate in the US. It provided that the policy decision was a positive thing for the economy respectively. It all works together to control the money supply and economic policies to bring a desired economic growth. It has passed couple of laws and policies throughout the decades to bring transparency and support in this economy. It is all to help us be better and not suffer economically.

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