You must answer this question by using the Aggregate Demand (AD) and Aggregate Supply (AS) model and use the Dutch economy as the starting point for your analysis.

2) Describe recent changes in fiscal and monetary policies that are relevant to the Dutch economy.

(for example the pandemic?)

To complete question 2, make sure you know what the difference is between fiscal policy and monetary policy.

Compare your answers above with the main EU rules agreed underthe Stability and Growth Pact. For recent monetary policy changes, read up on thePandemic Emergency Purchase Programme (PEPP)launched by the European Central Bank (ECB).

Link: https://www.investopedia.com/terms/s/stability-growth-pact.asp

Link: https://www.ecb.europa.eu/mopo/implement/pepp/html/index.en.html