Elucidate what does this imply about the use of monetary

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Q1. Use the IS-LM model to show that monetary policy becomes more effective relative to fiscal policy as money demand becomes less sensitive to the interest rate. Elucidate the result intuitively. Elucidate what does this imply about the use of monetary and fiscal policy over the business cycle?

Q2. Elucidate how each of the following people would talk about scarcity and trade-offs. (a) the President of the United States (b) the leader of a developing nation (c) a U.S. citizen whose income is in the top one percent (d) a U.S. citizen whose income is in the bottom 5 percent.

Reference no: EM1345097

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