4 -Under the fixed FX regime, the fiscal policya)is used to change income levelIs used to reduce inflationIs supported by monetary policy to prevent adverse effects of policy changesIs give up and not used as a policy instrumentb)0023c)d)e)None of the choices

Fiscal policy: These are the policy measures which is being introduced by the government of a…

Answered: 4. Under the fixed FX regime, the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The U.S. monetary policy is conducted to achieve two goals of price stability and fullemployment output. In the short run, monetary policy can influence economic activity through the monetary transmission mechanism. Which of the following is false?a. Monetary expansion tends to encourage consumption by lowering the interest rate. b. Monetary expansion tends to encourage investment by lowering the interest rate. c. Monetary expansion tends to lead to appreciation of the domestic currency, which encourages the foreign imports.d. Monetary contraction leads to lower asset prices, which tends to discourage investment.e. All of the above are correct
If a central bank buys government securities from the private sector-money markets,leading to an expansion of the money supply, other things being equal, what would theeffect be on the following?(d) Aggregate Supply(e) Aggregate Demand(f) Economic activity(g) Price level of the economy can you help giving me these 4 ans.
Explain the difference between fiscal policy and monetary policy. Explain also 2 advantages and 2 disadvantages of both policies.
8) The Federal Reserve president bumps his head and sets his mind on achieving 2% unemployment using monetary policy. Your country is currently in long-run macro equilibrium with an unemployment rate of 4%. a. To lower unemployment, should the central bank use expansionary or contractionary policy? Expansionary Contractionary b. Illustrate what would happen in the short with a graph. Show the current equilibrium and post policy.
Question 5A Starting from a baseline Long Run Steady State Equilibrium (LRSSE), the federal reserve increases interest rates. i. What kind of policy is this (Monetary or fiscal; ii. iii. expansionary or contractionary? How do you know? As a response which curve will start shifting in which direction? Why? How will this policy make the economy move away from the baseline Long Run Steady State Equilibrium (how would it change unemployment or price level relative to the long run steady state equilibrium )? iv. Draw a graph to show the changes to the long run steady state equilibrium (LRSSE).
Fiscal and Monetary Policies a. Write down the relationship between Budget Deficits, Debt, Government Spending and Taxes as a ratio to GDP. Explain the four independent variables that affect the ratio of Debt to GDP and the direction of its movement b. Explain the difference between policy rule and policy discretion in monetary policy. Please provide examples.
Note: don't use chat gpt.
Analyse the impact of these events on the price level and total output of an economy in the short term. If policymakers were to use monetary policy to actively stabilize the economy, in which direction should they move the money supply and interest rate and show the effects of these policies? Please discuss your answers with appropriate graphs. - (a) The government raises taxes and reduces expenditures to balance its budget. (b) Enterprises in the economy are pessimistic about the economy in the future. - (c) Foreigners increase their taste for domestically produced beef. (d) The money wage rate rises.
44)Which of the following statements is most accurate regarding fiscal policy and monetary policy? Select one: a. Monetary policy can be changed more quickly than fiscal policy. Fiscal policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change fiscal policy. b. Fiscal policy can be changed more quickly than monetary policy. Fiscal policy has much shorter delays due to the smaller number of legislators involved. c. Monetary policy can be changed more quickly than fiscal policy. Monetary policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change monetary policy. d. Fiscal policy can be changed more quickly than monetary policy. Monetary policy has much longer delays due to the larger number of legislators involved.
Quantitative easing can be described as A, B, C OR D ONE ANSWER A the purchase of long-term government and private mortgage backed securities by central banks to make credit available so as to stimulate aggregate demand. B the purchase of long-term government and private mortgage backed securities by central banks to make credit less available so as to stimulate aggregate demand. C the buy back long-term government and private mortgage backed securities by central banks to make credit available so as to decrease aggregate demand. D the buy back long-term government and private mortgage backed securities by central banks to make credit less available so as to decrease aggregate demand.
Question 9: If the central bank buys government securities from the private sector-money markets, other things being equal, what would the effect be on the following? (a) The economy's monetary base Click or tap here to enter text. (b) Short-term money market interest rates Click or tap here to enter text. (c) Aggregate demand, economic activity and inflation Click or tap here to enter text.
4) Why might it be expected that an increase in interest rates will tend to reduce inflation?

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4. Under the fixed FX regime, the fiscal policy is used to change income level Is used to reduce inflation Is supported by monetary policy to prevent adverse effects of policy changes Is give up and not used as a policy instrument a) 0025 b) c) d) e) None of the choices