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The economy of Country Island is in long-run equilibrium. The government is concerned about the size of national debt. Please 1. Draw an AD/AS model
The economy of Country Island is in long-run equilibrium. The government is concerned about the size of national debt. Please 1. Draw an AD/AS model to indicate the current situation. 2. What kind of fiscal policy should the government take to reduce the national debt? How will it affect the economy? Use AD/AS model to explain. 3.Limit to government expenditure, how will the fiscal policy in question (2) affect the size of national debt and why
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