Problem Set Week 6 Econ 1A Summer . What is the Federal Reserve and who is the current Chair of the Fed? . What are the discount rate and federal funds rate? How does the Fed \"set\" both of these rates? . Explain how the Fed could use Open Market Operations to increase Aggregate Demand. (list all steps involved). . Explain how built-in or automatic stabilizers work to limit the severity of recessions and give an example. . Briey state and explain the three time lags associated with fiscal policy. Which of these lags will monetary policy also experience? . When the economy is in recession and the government wants to do expansionary policy, give two examples of actions they could take. . Assume the US is experiencing an inationary gap of $52 billion, and has a multiplier of 4. How much would the government have to cut spending to close this gap? . Which type of policy (monetary or scal) is more effective at closing recessionary gaps? Which type is more effective at closing inationary gaps? . How do expansionary policies affect equilibrium price levels and real GDP