Answer to Question #69830 in Microeconomics for edmond

Question #69830
if the country plans to reduce unemployment rate during this period (with fixed exchange rate implemented), assuming perfect capital mobility presence in the market, would you recommend the government use monetary policy or fiscal policy? explain the reasons behind your recommendation with the aid of diagrams.
1
Expert's answer
2017-09-01T09:57:07-0400
If the country plans to reduce unemployment rate during this period with fixed exchange rate implemented, assuming perfect capital mobility presence in the market, I would recommend the government to use expansionary monetary policy to improve economic activity and employment.

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