Suppose that the coronavirus pandemic (COVID 19) in 2020 has resulted in a leftward shift ofthe aggregate demand curve (it has also shifted the short-run aggregate supply to the left, but let’s ignore...

Suppose that the coronavirus pandemic (COVID 19) in 2020 has resulted in a leftward shift ofthe aggregate demand curve (it has also shifted the short-run aggregate supply to the left, but let’s ignore this effect here for simplification).

1. Can policymakers use monetary policy (and/or fiscal policy) to accommodate this shock?

Describe what happens to the economy in response to this policy action