How do the Minsky and Austrian explanations for the causes of Great Recession differ? Minsky explanation is based on bubble of euphoria where prices were seen to skyrocket and then later fall and thus investors in this type of practice making them to lose a lot of money while the Austrian explanation is solely on the government lowered interests that made people borrow lots of money that eventually they were not able to pay back. Explain how the proponents of government stimulus believe that it will affect aggregate demand The proponents believe that the government stimulus would increase the aggregate demand by lowering the interest charged on the products and services and thus allowing the consumers to spend more in their bid to acquire such