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Responds to current economic conditions

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Reference no: EM131095129

Assume that you have been invited to advise the Federal Reserve Chairman about the direction of U.S. monetary policy for the year ahead.

  1. Prepare a summary of these key indicators for the U.S. economy: current inflation, current unemployment, and current real GDP growth.
  2. Based on these indicators, describe the state of the U.S. economy in terms of the business cycle.
  3. Propose a monetary policy (contractionary or expansionary) that responds to current economic conditions. Be specific about which tool of monetary policy you will use and how it works.
  4. Make your case for the policy by describing its expected impact using the AD-AS model.

Reference no: EM131095129

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