Discussion Questions

1. In 2008 and 2009, households that were able were encouraged by financial advisors to increase their savings to make it possible for them to be prepared for possibly very uncertain financial future. The saving rate increased from 4.9 percent to 6.1 percent. Is it possible that this advice and the subsequent following of it by millions of Americans had any relationship to the severity of the Great Recession?

2.Throughout the early 2000s, imports increased faster than exports. Explain the effect of this trend on theC+I+G+Xcurve and on the aggregate demand (AD) curve.

support your arguments and include sources of your information where possible (text, articles, videos).