In 2008-2010 (and perhaps, extending to now), the United States has experienced a recession of a relatively large magnitude and a slow recovery from this recession. Using the AD-AS framework, please address the following questions:
(a) What, in your opinion, has caused the recession, and how does your explanation fit within the AD-AS model? For example, please indicate whether the cause(s) that you describe resulted in a shift of AD or AS or both, the direction of the shift, and its magnitude.
(b) What fiscal and monetary policies has the government engaged in to correct the economy? In your response, please define fiscal and monetary policy, and give at least one example of each.