Reference no: EM133129216

The Coronavirus has presented a fast evolving and significant challenge to global health systems and economies. The Government has acted decisively in the national interest to support households and businesses and address the significant economic consequences of the Coronavirus. The Government's economic support package has provided timely support to affected workers, businesses and the broader community, and has kept Australians in work, and businesses in business. On 21 July the Government announced the extension of the JobKeeper Payment for a further six months until 28 March 2021 and is targeting support to those businesses and not-for-profits who continue to be significantly impacted by the Coronavirus. To support the economic recovery, the Government is extending and further tailoring temporary economic measures to support sectors, regions and communities that will continue to face challenges. These actions have supported the economy during this extraordinary time and have set the foundation for a strong economic recovery once the Coronavirus crisis passes.

With reference to the business cycle and the AD/AS model, explain whether the Coronavirus has caused the economy to be in a recessionary or expansionary period.