It appears that there was an economic drop during the 2019-2021 period as a result of the pandemic. Assume that we can view this as a negative shock to private investment, due to a combination of lockdowns and uncertainty about the world. In under 150 words, answer the following question: Was government consumption expenditure used as stabilisation policy following the slow-down during 2020 and 2021? (Note, you only need to discuss this in terms of our demand model of Income-Expenditure, IS-MPR, and Aggregate Demand.)YearGovernment consumption per capita ($) (rounded to a whole number)2003667220046820200570162006739420077515200877572009804020107892201179312012796920137955201480412015815420168124201780962018823820198371202086582021920720229962

Stabilization Policy: Stabilization policy refers to the actions taken by a government or central…

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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It appears that there was an economic drop during the 2019-2021 period as a result of the pandemic. Assume that we can view this as a negative shock to private investment, due to a combination of lockdowns and uncertainty about the world. In under 150 words, answer the following question: Was government consumption expenditure used as stabilisation policy following the slow-down during 2020 and 2021? (Note, you only need to discuss this in terms of our demand model of Income-Expenditure, IS-MPR, and Aggregate Demand.)

Year	Government consumption per capita ($) (rounded to a whole number)
2003	6672
2004	6820
2005	7016
2006	7394
2007	7515
2008	7757
2009	8040
2010	7892
2011	7931
2012	7969
2013	7955
2014	8041
2015	8154
2016	8124
2017	8096
2018	8238
2019	8371
2020	8658
2021	9207
2022	9962

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