Discussion on the macroeconomists position on trade deficits.
1.The public tends to view trade deficits with alarm while macoreconomics claims that trade deficits can actually be helpful for an economy. Elucidate the macroeconomists position on trade defilicts?
2. Assume an economy has overbuilt and suffers from excess capacity. A recession ensues due to firms cutting back on expenditures. Is deficient demand more easily remedied by monetary or fiscal policy for this economy? Explain