Assignment | Expansionary Economic Policy

Focus of the Final Paper

In an effort to move the economy out of a recession, the federal government would engage in expansionary economic policies. Respond to the following points in your paper on the actions the government would take to address expansionary fiscal and monetary policies:
Expansionary Fiscal Policy:
Explain the actions the federal government would take while engaging in expansionary fiscal policy in terms of the following:
The necessary change in taxes and government spending,
The effect on aggregate demand, GDP, and employment.
Expansionary Monetary Policy:
The three tools the Federal Reserve Bank (The Fed) uses when conducting monetary policy are the required reserve ratio, the discount rate, and open market operations.

Explain the actions of the Fed in regard to the three tools.
When the required reserve ratio is increased or decreased
When the discount rate is increased or decreased
Buying or selling government securities when conducting expansionary monetary policy
Explain how these actions would affect the money supply, interest rates, spending, aggregate demand, GDP, and employment.

Writing the Final Paper

The Final Paper:
Must be eight to ten double-spaced pages in length and formatted according to APA style as outlined in your approved styled guide.

SAMPLE SOLUTION

Global financial crisis and general economic recession always pose great challenges even to the great economic giants of modern times. However, improved monetary policies have proven to be the great answer to this jigsaw puzzle as they help unravel the twists and turns of the economy in order to promote a rather uncertain one in the ever difficult economic environment. In the US, it is the duty of the Federal Reserve to enact policies that foster stability of prices and improve employment rates. However, a challenge occurs in trying to attain maximum employment as well as sustain the economy.
Expansion economic policies are more often than not used by Federal governments to ensure that the economy is not in recession. This research paper is meant…