Part 1: Assume that the country is in a period of high unemployment, interest rates are at almost zero, inflation is about 2% per year, and GDP growth is less than 2% per year.
Include the following concepts in your discussion:
Part 2: Assume that the country is in a budget deficit and carrying a very large debt. Discuss the dangers of a high debt to GDP ratio and a growing budget deficit. Would this affect any policy changes you discussed in Part 1?
Running head: FISCAL AND MONETARY POLICY Fiscal and Monetary Policy
Institution 1 FISCAL AND MONETARY POLICY 2 Fiscal and Monetary Policy
The fiscal and monetary policy…