Fiscal policy have a strong impact

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Q1. When output and employment slowed in early 2008, the Bush Administration and the Democratic Congress passed a legislation sending households a check for $600 for each adult (and $300 per child). How these checks were financed by borrowing. Would a Keynesian favor this action? Explain why or why not?

Q2. On aggregate demand does fiscal policy have a strong impact? Explain the shift of the federal budget from deficit to surplus during the 1990s weaken aggregate demand? Explain government expenditure increases and large budget deficits of 2008-2011 strengthen aggregate demand? Talk about?

Reference no: EM138264

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