If a Central Bank decides it needs to decrease both the aggregate demand and the money supply, then it will:

Q: If the Federal Reserve wants to keep aggregate demand (i.e. spending growth) stable, what will it do…

A: The objective of the question is to understand the role of the Federal Reserve in managing the money…

Q: What uncertainties does the federal reserve face in selecting the timing and tools of implementing…

A: The uncertainties that the Federal reserve face in selecting the timing and tool of implementing…

Q: If the central bank’s goal is to maximize output, what interest rate will we expect in equilibrium?

A: The equilibrium real interest rate is the real rate of return which must be maintained to keep the…

Q: In what respects is the central bank like a private banking institution and it what respects is it…

A: The central bank is an apex banking institution in a country. It is responsible to regulate the…

Q: Let's assume that in the Asgardian's model of the economy the natural rate of interest is denoted as…

A: Asgardian central bank The central bank is considered the apex bank of the nation and is…

Q: Empirical evidence show that monetary policy may not always be successful in pulling an economy out…

A: Monetary policy is that the micro  economy policy ordered down by the financial organization. It…

Q: Why do Keynesian economists believe increasing the money supply is a good idea? Use the equation of…

A: The equation of exchange gives a relationship between money supply (M), Velocity of money (V), Price…

Q: Why would a central bank implement a monetary policy when the inflation level is higher than…

A: The economies tend to have many entities with them, all of which are concerned with performing…

Q: Is full employment a realistic goal for a central bank? Please illustrate using examples

A: Full employment is defined as the utilisation of all available labour resources in an economy and…

Q: Why does the credit view imply that monetary policy hasa greater effect on small businesses than on…

A: Monetary policy is the policy made by the central bank, which involve management of the interest…

Q: Should Central Banks be independent? Explain and discuss.

A: The question of whether central banks should be independent is a topic of ongoing debate in the…

Q: We've learned that the primary focus of the Federal Reserve is interest rates. Why would the Federal…

A: The federal reserve is responsible for controlling not only the interest rate but also the money…

Q: Explain tools used by central bank to: stimulate economy, to contain inflation How do government…

A: Central bank is an institution assigned with the task of maintaining proper money supply in the…

Q: Explain any two important functions of central bank in an economy?

A: According to the given question  In simple words we can say that a central bank is a bank which…

Q: One of the advantages of monetary policy is its speed and flexibility, but there are limitations.…

A: Monetary policy is the policy of the central bank of the economy to influence the money supply in…

Q: What are the effective Central Bank Frameworks?

A: The operational frameworks of central banks influence their choices and actions. As market…

Q: Why was the European Central Bank less aggressive than the U.S. Federal Reserve Bank in responding…

A: Answer- Need to find- Why was the European Central Bank less aggressive than the U.S. Federal…

Q: Which of the following are objectives that the Federal Reserve tries to achieve when setting…

A: Monetary Policy is a policy implemented by the central bank of a country (such as the Federal…

Q: discuss how money supply is determine by the central bank and economics activities

A: Money : Money is something which is used to make transactions and which earns no interest. This…

Q: can you explain what the meaning of "central banks are like birds" ??

A: A central bank is a national or supranational institution responsible for implementing monetary…

Q: Why is there a lag between the Fed’s actions and the economy’s response?

A: In the behaviour of the Fed and the response of the economy, there is a time lag. The point of touch…

Q: What is the difference between contractionary monetary policy and expansionary monetary policy and…

A: Monetary policy is the action taken by the central bank to control the overall supply of money and…

Q: Discuss how the central bank increase the federal funds rate ripples through the different sectors…

A: The economies around the world tend to focus on their growth and development through various…

Q: Which of the following policy actions by the Central Bank is likely to increase the money supply?…

A: The central bank is the monetary institution that controls the money supply. The money supply is the…

Q: If central Bank increases money supply at a rate that is higher than before , what will be the…

A: The quantity theory of money: The quantity theory of money supply indicates that money supply and…

Q: The main responsibility of a Central bank is: Fiscal but not monetary policy…

A: A central bank is basically a financial institution with exclusive authority over the production and…

Q: Can you further explain the role of central bank in an economy.

A: A financial institution known as a central bank is in charge of overseeing the monetary policy of a…

Q: Identify the four major tools of monetary policy

A: The monetary policy is used by the central bank of the economy and the central bank of the economy…

Q: What do Federal Reserve economists use the Federal Reserve Board's model of the U.S. economy for? It…

A: The Federal Reserve Board's model of the U.S. economy, often referred to as the FRB/US model.The…

Q: Contrast the actions a central bank would take to increase the quantity of money in the economy with…

A: In macroeconomics, the government and the central bank plays a very important role in stabilizing…

Q: Using a money market, a causal chain, and the Macro model, describe and show how expansionary…

A: The money market is the component of the economy which provides the short term funds and loans to…