In 2-3 paragraphs (see getting started module for details, including the specific sentence length requirements), respond to the following. Your initial post should be substantive. Also reply to at least 2 classmate's posts. Offer a substantive reply of at least 1 paragraph. Aim to complete your initial post by Thursday of each week to allow other students to respond before Friday. As you have learned in the last chapters, policymakers have important decisions to make about whether and how to take actions designed to change conditions in the macroeconomy. This is not an easy task!There are many considerations - Is the economy doing well on its own? If not, would policy help? What kind of policy - monetary, fiscal, both? Is the economy in an expansion or a recession? Should we engage in expansionary policy or contractionary policy? What particular type of action should we take? If monetary, do we buy bonds or sell bonds? If fiscal - should we change taxes or government spending? And should the change be an increase or a decrease? For all policy actions, remember how important timing is to taking the appropriate action in a way that will accomplish the intended outcome (to the extent that policymakers can influence it).

Take a few moments to look at this video review of macroeconomic policy hosted by your friend, and mine, Mr. Clifford. Take the time to test yourself before you take on this last discussion assignment. (Remember that the AS curve that Mr. Clifford refers to shifting as the economy self-corrects is the SRAS.)CAUTION: Remember that not every action taken by the President and Congress constitutes discretionary fiscal policy - review this in addition to how policy works in the AD/AS model.