4 Some economists hold the views that Australia is heading to a recession (for such a view, read here http://www.abc.net.au/news/2016-07-29/australia-he…
One such scenario may come from a crash in the Australian housing market. Keeping in mind of the Aggregate Demand and Supply (AD-AS) framework, elaborate how such a shock may affect the Australian economy. Also, discuss what policy instruments the government have in response, and how they work in practice?
Please do not write in the form of the bullet points.
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