The Fiscal and Monetary Response to the Pandemic
Due Date and Time: You will submit a 3-5 page, 12pt font, one-inch margins, short paper
(excluding any graphs, tables, and reference page). The paper must be uploaded to moodle
by Tuesday, November 24 at 5pm PST. Please submit your document as a PDF via
moodle, and title your paper Lastname_Paper.pdf
Late assignments cannot be accepted! If you turn in a late assignment it will receive a zero
and you will receive no credit.
Format: APA style with in-text citations, please include a Reference List page, no
footnotes or endnotes.
Background and Task: The U.S. Federal Reserve (Fed) responded to the pandemic with
a broad array of conventional and non-conventional actions aimed at providing relief and
stability during this period of constrained economic activity.1 One of the Fed’s main goals
was to ensure that credit continues to flow to businesses and households during the
pandemic. The Fed’s forceful actions were also intended to ensure a strong and quick
recovery as the effects of the pandemic lessened.
The U.S. government also responded with several federal laws aimed at providing
assistance to households, businesses, and state and local governments affected by the
economic consequences of the pandemic. A few examples of the measures taken include:
The Paycheck Protection Program which provided loans to small businesses to help them
cover payroll and other costs, the increase in unemployment insurance payments and the
eligibility expansion under the CARES Act; and the refundable tax credit of $1,200 per
qualifying adult and $500 per dependent child.
For this assignment, write a short paper on either the monetary policy OR fiscal policy
response to the pandemic. In your paper you should outline two specific actions taken by
the Federal Reserve (monetary policy) OR two specific actions taken by the government
(fiscal policy). You should also provide a theoretical framework that outlines how those
actions were intended to impact the macroeconomy (use the macroeconomic models from
Econ 102). Finally, provide an analysis of whether these actions were an appropriate
response to the economic impacts of the pandemic (Do they seem to be working? Provide
evidence.) or whether the policy actions have fallen short of what is needed for a strong
and equitable economic recovery.
This writing assignment provides you with an opportunity to apply the tools developed in
the course (Econ 102) to a specific, current economic issue. You can cite newspaper and
magazine articles from the Wall Street Journal, New York Times, Business Week, The
Economist as well as policy briefs produced by government agencies, the Federal Reserve,
1 See https://www.federalreserve.gov/covid-19.htm and https://fraser.stlouisfed.org/timeline/covid-19-
or research think tanks. Whenever appropriate, use graphs or equations from the macro
section of our course to apply the theory to the policy response.
Your grade will reflect the quality of your economic analysis, as well as your ability to
express your ideas clearly and effectively. Your papers should be well-written. Points will
be deducted for incorrect spelling, grammar, incomplete sentences, and poor organization.
Avoid lengthy introductions. Be concise in your analysis and make sure not to just
summarize articles you are reading. Summarizing is different from analyzing and applying
concepts from this course.
Make sure all graphs are labeled and referenced to in the actual paper.
You may cite as many articles as you wish in your paper.