Problem
Answer each question in at least 3-5 sentences.
1. What would Adam Smith have to say about government intervention into the economy - be it fiscal or monetary policy? What is your opinion, can government tinkering do good, and even if it can, will such interventions likely produce harmful secondary effects in the long-run? Be sure to support your opinion with factual analysis.
2. Can monetary policy stimulate real GDP in the short run? Can it do so in the long run?
3. How does monetary policy affect interest rates, output, and employment?
4. How is the supply of money determined?