Monetary policy debates often revolve around the question of rules versus discretion. Explain the argument on...

Monetary policy debates often revolve around the question of rules versus discretion. Explain the argument on each side of this debate.

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Rahul Sunny answered 2 years ago

1) Outline a short argument for or against having monetary policy conducted according to set rules...

1) Outline a short argument for or against having monetary policy conducted according to set rules instead of more flexible policy 2) Provide three possible downsides of high levels of government debt Application to Data: Use data on the yields of U.S. Treasury Bonds to infer inflation expectations.

Discuss 1. the moral hazard and 2. rules versus discretion as two potential dillemmas policymakers face...

Discuss 1. the moral hazard and 2. rules versus discretion as two potential dillemmas policymakers face within the context of managing the business cycle. Use examples to support each of your answers.

This is a criminology class Question: The central issues in "Theories of Victimization" revolve around four...

This is a criminology class Question: The central issues in "Theories of Victimization" revolve around four perspectives- victim -precipitation, deviant place, lifestyles, and routine activities. In the scenarios presented in Part 1, you had to consider how three actors in the courtroom - the juror, the prosecutor, and the defense attorney - apply the tenets of the perspective they believe the best explanation for victimization. Explain your choices in the scenario by addressing the following questions. Which perspective do you...

This deals with the six debates over macroeconomic policy, which include stabilization policy, government spending, monetary...

This deals with the six debates over macroeconomic policy, which include stabilization policy, government spending, monetary policy on rules versus discretion, zero inflation target, balanced budget, public debt, and reforming tax laws. There are pros and cons of using monetary and fiscal policy tools to stabilize the economy. a, Explain the main arguments in favor of economic stabilization during recessions. Explain why policy lags could make stabilization policies counterproductive. b. What are the justifications given in favor of more government...

Monetary policy and fiscal policy often change at the same time.

Monetary policy and fiscal policy often change at the same time. (a) Suppose the government wants to raise investment but keep output constant. In the IS-LM model, what mix of monetary and fiscal policy will achieve this goal? In other words, what needs to happen to M and G or T? Sketch the IS-LM model and illustrate your answer graphically. (b) In the early 1980s, the U.S. government cut taxes and ran a budget deficit while the Fed pursued a tight monetary...

1) Some people believe that monetary policy should be made by rule rather than by discretion....

1) Some people believe that monetary policy should be made by rule rather than by discretion. One of their beliefs is that setting a policy rule will limit the abuse of power of policymakers. policymakers can better influence the political business cycle in their favor when following a policy rule. a policy rule provides policymakers with the greatest flexibility to manage inflation. if the Fed was required to follow a low-inflation policy, the economy would face a less favorable short-run...

Name two monetary policy rules, either proposed or actual.

Explain Fiscal policy and Monetary policy

Which of the following events would strengthen the argument for the use of monetary policy and...

Which of the following events would strengthen the argument for the use of monetary policy and weaken the argument for the use of fiscal policy? I. Investment spending becomes more sensitive to changes in interest rates. II. A balanced budget amendment is passed and made effective. III. International trade and financial flows become a more important part of the U.S. economy. A I only B II only C I and II only D II and III only E I, II,...

MONETARY POLICY This question explores the role of expansionary and contractionary monetary policy in the aggregate...

MONETARY POLICY This question explores the role of expansionary and contractionary monetary policy in the aggregate demand and aggregate supply model. You will use schedules for an aggregate demand line and an aggregate supply line to identify the equilibrium price level and real GDP in a macroeconomy. Additionally, you will compare the short-run equilibrium level of real GDP to the full employment level of real GDP to identify desirable monetary policies. Below, you are provided the schedules for aggregate demand...

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