![Describe what is meant by the liquidity trap. Discuss the problems posed by the liquidity trap and the optimal ways to escape from it. | Ivory Research Describe what is meant by the liquidity trap. Discuss the problems posed by the liquidity trap and the optimal ways to escape from it. | Ivory Research](https://www.ivoryresearch.com/wp-content/uploads/2013/04/melanie-brown-fig-1.gif)
Describe what is meant by the liquidity trap. Discuss the problems posed by the liquidity trap and the optimal ways to escape from it. | Ivory Research
![macroeconomics - What is the effect of expansionary fiscal policy in case liquidity trap situation? - Economics Stack Exchange macroeconomics - What is the effect of expansionary fiscal policy in case liquidity trap situation? - Economics Stack Exchange](https://i.stack.imgur.com/PUkxH.jpg)
macroeconomics - What is the effect of expansionary fiscal policy in case liquidity trap situation? - Economics Stack Exchange
![The liquidity trap: A. Refers to the vertical portion of the money demand curve. B. Refers to the possibility that interest rates may not respond to changes in the money supply. C. The liquidity trap: A. Refers to the vertical portion of the money demand curve. B. Refers to the possibility that interest rates may not respond to changes in the money supply. C.](https://homework.study.com/cimages/multimages/16/money_dd3668212932293786523.png)