Current Economics Condition

1. How many workers applied for unemployment insurance for the week ended March 21, 2020? How does this number compare to historic levels of unemployment claims? Describe what is happening in the U.S. economy right now and explain why this has led to so many people losing their jobs so quickly.
2. According to the article, economists are not sure whether this will be a short period of decline or whether we are headed for a long recession. Describe (in your own words) the scenario where the decline is short and describe the scenario where the decline is much longer.
3. Using the aggregate demand and supply model we developed in class, describe how aggregate demand has been impacted by the Coronavirus (Has the curve shifted, and if so, in which direction?). Refer to at least two of the components of aggregate expenditures (C, I, G, or NX) to explain what is happening to aggregate demand. At the time the article was published, Congress was considering a $2 trillion dollar fiscal stimulus package to help the economy. In terms of the aggregate demand and supply model, what is the goal of this package (which curve are they trying to shift and which direction are they trying to shift it)?

Sample Solution

In the 1960’s, George Carlin, a once straight laced, suit and tie stand up comic, was arrested alongside Lenny Bruce. Carlin and Bruce shared a ride to the station and when Carlin returned to work, he wasn’t the same. Carlin had adopted the philosophy that a comic’s job was to find the line and wildly leap across it. This philosophy is what lead up to the famous “obscenity vs indecent” case known as FCC vs. Pacifica. Carlin had a segment referred to as “dirty words” that lasted approximately 12 minutes and included many explicit terms typically thought of as “dirty”. After performing this segment in Milwaukee, Carlin was arrested July 1972 for disobeying obscenity laws but the case was later dismissed citing that Carlin’s language was indecent but not obscene. A little over a year later, Carlin’s “dirty words” segment was played on a Pacifica affiliate radio at around 2:00p. John H. Douglas heard the segment while driving home that afternoon. Douglass complained to the FCC since his 15 year old son was in the car when the segment started and he was offended that his son had been exposed to such crass language. In his letter, Douglass lamented the fact that this “obscene language” was played at a peak time of day when any unsuspecting child could accidentally tune in and be exposed to it. Thus began the FCC vs. Pacifica trial. While this was the only recorded complaint Pacifica received, the FCC looked into Douglass’ complaint and in 15 months gave a ruling.

Initially, the FCC reprimanded Pacifica for allowing an “obscene” segment to be aired on the radio at a peak time of the day. The FCC argued that the language used in Carlin’s segment was offensive, though the FCC did not believe it was obscene, and went against the statute prohibiting the broadcast of obscene, indecent and profane language. With this in mind, the FCC set a specific time of day where th

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