Question

Continue your observation of the 10-year period selected for Milestones One and Two and research the government monetary policies during that time frame. This year are 2005-2015, I need actual data not definitions of the terms specified down below. Specifically, the following critical elements must be addressed:

 Examine the monetary policies in place at the start of your specific time period in relation to their effects on macroeconomic issues. For instance, consider the discount rate set by the Fed, the rates on reserves, open market operations, and so on.

 Analyze new monetary policy actions undertaken by the U.S. government throughout the time period by describing their intended effects, using macroeconomic principles to explain the actions.

 Explain the impact of the new monetary policy actions on individuals and businesses within the economy by integrating the macroeconomic data and principles.

Answer 1

The above graphs show how unemployment increased to 11 percentage and above and work productivity deckijed during Great Recession and subsequently the government had adopted expansionary monetary policy to cit down interest rates to 0.75 percent and hold constant till 2015 and indulged in buying 800 billion dollar government securities as part of open money operations and quantuat3easing programme.

The interest rates prior to 2007 from 2005 were relatively higher as contractionary monetary policy was practised by US FEd due to high inflation and hot money flowing in from Asian financial markets.

The period of 2010 to 2015 saw interest rates constant, coupled with an expansionary fiscal policy like unemployment insurance, program like TARP and TNAF and tax cuts and tax credits to businesses.

The macroeconomic intention here was to revive the economy to greater heights and minimise deflation such that the US dollar also stabilises and inflation targets remian well within 3 percentage band.

This crested ripple effect as liquidity rose substantially and disposable incomes rose for 22% of individuals after tax cuts, unemployment insurance provided the fillip, and unemployment reduced due to higher credit availability to corporate which all sledgehammered the economy to better position of 0.5% year on uear GDP growth and ultimately fructifying to robustness by end of 2015 post which US fed looked to raise the interest rates after Donald Trump election in 2016.

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