Soma L.

asked • 06/03/21

AP Macro Question Pls Help ASAP!

In this module, you have learned about monetary and fiscal policies. 

In a paragraph, define what fiscal policy is and explain how it works. Also, explain who is responsible for fiscal policy and give an example that illustrates how fiscal policy is implemented and its intended outcome. Based on your example, draw 2 graphs, the first one that shows the issue the policy is intended to correct and the second graph that shows how the policy impacted the issue. Below the graph, explain how you drew each and what needs to be included in a fiscal policy graph. 

In a second paragraph, define monetary policy and explain who makes it. Detail each part of monetary policy including open market operations, the discount rate, federal funds rate and the required reserve ratio and explain how each part works and how it impacts the economy. Give an example that illustrates how monetary policy is implemented and its intended outcome. Based on your example, draw 2 graphs, the first one that shows the issue the policy is intended to correct and the second graph that shows how the policy impacted the issue. Below each graph, explain how you drew it and what needs to be included in a monetary policy graph.

In a third paragraph, explain the difference between monetary and fiscal policy and also explain how they work together to regulate the economy.


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