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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

Explain how to use quantitative easing to stimulate aggregate demand.

To determine

The way aggregate demand can be generated with the help of quantitative easing.

Explanation

At the time of recession when the Fed had already reduced the rate of interest to zero, it becomes impossible to lower it any further or stimulate the economy. To overcome this situation, the Fed adopted quantitative easing (QE), which is an innovative policy designed to stimulate the economy...

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