• Explains the use of Government policy to control the economy.
• When is it appropriate to use monetary and fiscal policy to stimulate or stabilize the economy? Look at both.
• When is it inappropriate to use monetary and fiscal policy to stimulate or stabilize the economy? Look at both.
• What specific fiscalpolicy tools can be used to stimulate aggregate demand and how?
• What specific monetary policy tools can be used to stimulate aggregate demand and how?
• Shouldpolicymakersuse the monetary and or fiscal policy, or a combination of both, to stimulate aggregate demand? Explain the reasoning.