Question 2.

JobKeeper was designed to keep people employed and 'sustain' the economy through the enforced lockdown. Using the static AD/AS model explain.

2a. Use the static AD-AS model to explain how the JobKeeper policy worked to sustain the economy (even though unemployment increased). Max 5 marks

2b. Why does Kennedy expect a 'U' shaped recovery rather than a 'V' shaped recovery? In your answer explain the difference between the two types of recoveries