The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Question

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Answer 1

Question

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

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subject to X1 X2 Maximize dollars of interest earned = 0.07X1+0.11X2+0.19X3+0.15X4 ≤ 1,000,000 <2,500,000 X3 ≤ 1,500,000 X4 ≤ 1,800,000 X3 + XA ≥ 0.55 (X1+X2+X3+X4) X1 ≥ 0.15 (X1+X2+X3+X4) X1 + X2 X3 + XA < 5,000,000 X1, X2, X3, X4 ≥ 0

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Answer 2

Question

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

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Answer 3

Question

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

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Answer 4

Question

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

Answer 6

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

Answer 7

Chapter 33, Problem 1SPPA

To determine

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Answer 8

Expert Solution & Answer

Explanation of Solution

When the government budget is at deficit it will make the country vulnerable and instable.This could lead to pressurize the central banks as they should provide the necessary money needed. Furthermore, when the country is not stable the central bank could be attacked as it is also in that country. When the government is at debt, it will ask for money from the central bank and the bank should provide the government with necessary money that is needed and this could make the centrals bank's job harder as the bank should allocate the money properly according to what it has in it reserves.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Deficit:

A deficit takes place when the government spending is more than the revenue and the total of all the deficits that took place before is the debt of the state.

Quantitative easing:

Quantitative easing is known as the large-scale asset purchasing. It is the monetary policy where the central bank buys bonds or other financial assets in order to inject it into the economy. The central bank gives commands to the other commercial banks and acts as the head for the other commercial banks.

Answer 12

Ch. 33 - Prob. 1SPPA Ch. 33 - Prob. 2SPPA Ch. 33 - Prob. 3SPPA Ch. 33 - Prob. 4SPPA Ch. 33 - Prob. 5SPPA Ch. 33 - Prob. 6SPPA Ch. 33 - Prob. 7SPPA Ch. 33 - Prob. 8SPPA Ch. 33 - Prob. 9SPPA Ch. 33 - Prob. 10SPPA

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

To explain: The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.

Explanation of Solution

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Chapter 33 Solutions

To explain:

The way a government budget deficit and debt can impend the financial stability and can cause the job of the central bank more difficult.