The context in this is a large negative shock to autonomous consumption in an open economy. You may assume the economy is initially at a medium run equilibrium. Provide two different scenarios in...

The context in this is a large negative shock to autonomous consumption in an open economy. You may assume the economy is initially at a medium run equilibrium. Provide two different scenarios in which the macroeconomic policy response to the shock in an open economy includes the use of expansionary fiscal policy. Describe how the economy adjusts to medium-run equilibrium.