A severe and prolonged recessionary phase of a business cycle is sometimes described as

The spread between the interest rates on Baa corporate bonds and U.S. government bonds is very large during the Great Depression years 1930-1933. Explain this difference using the bond supply and demand analysis

What will be an ideal response?

A reduction in government spending causes the equilibrium level of aggregate output to ________ at any given interest rate and shifts the ________ curve to the ________, everything else held constant

A) rise; LM; right B) fall; IS; left C) fall; LM; left D) rise; IS; right