Question: Please explain detailly. Homework ... : 1 points ... LM Curve TE Is Curve Y CV-7)Yr+P+6 Suppose because of the worsening in expectations autonomous consumption
Homework ... : 1 points ... LM Curve TE Is Curve Y CV-7)Yr+P+6 Suppose because of the worsening in expectations autonomous consumption declines. Central bank faces with szero lower bound problem. Show that fiscal policy can help to avoid adeflation and depression and discuss step by step In addition, discuss why the monetary policy may be more effective and avoid zero lower problem if Inflation was high just before the external shock (worsening of expectations) T-T-1 PC curve 0 YN
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