Assignment instructionsPlease answer the questions below: 1. Relevant knowledge

Assignment instructionsPlease answer the questions below:
1. Relevant knowledge is important because monetary policy affects all aspects of the economy as well as the functioning of the product and financial markets.
Explain how monetary policy impacts economic activity.
Use a graph/chart to show the effects of a contractionary monetary policy to reduce inflation and move an economy back to potential real GDP.
Explain what happens to aggregate demand, real GDP, and the price level.
2. Exchange rates affect the prices of exported and imported products. Fluctuating exchange rates can also alter a multinational firm’s profits and losses. The U.S. corporation, Motorola, produces cell phones and sells cell phones in Mexico.
What would happen to Motorola’s costs and revenues if the dollar appreciated against the peso?
Submission instructions
The Learning Journal Activity entry should be a minimum of 500 words and not more than 750 words. Use APA citations and references if you use ideas from the readings or other sources.