Question

In: Economics

Please answer the following questions. q1: What event started WW1 in what year? q2: What were...

Please answer the following questions.

  1. q1: What event started WW1 in what year?
  2. q2: What were the two groups of alliances formed during the war?
  3. q3: Which country spent the most money on the war?
  4. q4: In what year did the war end and with which treaty?
  5. q5: What was the war guilt clause?
  6. Which group of alliances won the war?
  7. Which group of alliances won the war?

Fed Officials Step Up Calls for More Government Spending to Speed Economic Recovery

Summary: Federal Reserve officials stepped up calls for additional government spending to avoid an uneven and protracted economic recovery from the coronavirus pandemic. The recovery would move along faster “if there is support coming both from Congress and from the Fed,” Chairman Jerome Powell said during the second of three days of congressional testimony Wednesday. The Fed committed last week to a much longer interval of low rates than it did initially after the 2008 financial crisis. Officials said they would hold short-term rates near zero until inflation reaches 2% and is likely to stay somewhat above that level, something most officials don’t see happening in the next three years. But Mr. Powell and his colleagues said Congress and the White House, more than the Fed, had the power to hasten a faster recovery.

Questions:

  1. What steps has the Federal Reserve taken during the past several months to counter the impact of Covid-19?
  2. Why are Fed officials concerned that discussions in Congress to pass additional relief efforts have stalled?
  3. Why are Democrats and Republicans in Congress at a stalemate?     
  4. What criticisms have been directed at the Fed's efforts and, given what you know from the article and the current macroeconomic environment, do you agree?
  5. What has been the Fed's response to such criticism? Given what you know from the article and the current macroeconomic environment, do you agree with their perspective?

Dollar Regains Draw in Carry Trades

Summary: This year’s decline in the U.S. dollar is drawing investors back into a practice that they had eschewed for some years: Borrowing the greenback to buy riskier assets in what is known as a "carry trade." A number of investors are pursuing higher returns by buying overseas assets. The dollar is being used to fund such trades after a drop in U.S. interest rates this year made it less attractive for investors to hold dollar-denominated assets. With the Fed pledging to keep U.S. rates near zero for the foreseeable future, it may stay that way for a while.

Questions:

  1. How has the US dollar performed this year against other currencies and why?
  2. Why has the US dollar been weakening recently?
  1. What are the implications of a weakening US dollar?
  2. What is the "carry trade" and why are some investors pursuing it with US dollars as their funding currency?
  1. What factors could undermine the "carry trade"?

Solutions

Expert Solution

Answer Q1:  The world War 1 started in 1914 after the assassination of Archduke Franz Ferdinand of Austria. He along with his wife was murdered by a Serbian nationalist on June 28 1914.

His murder catapulted into a war across Europe that lasted until 1918.

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Answer Q2: The two groups of alliances formed during the war:

Six major powers of Europe were split into two alliances : Triple Entente ( Britain, France, and Russia ) and Triple Alliance (Germany, Austria-Hungary, and Italy).

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Answer Q3:   Country spent the most money on the war. According to data of various countries Germany was the one who spent most during WW1

Germany --> $37775000000
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Answer Q4:   In what year did the war end and with which treaty?

On 28th June 1919, Germany and the victorious Allies, signed the Treaty of Versailles at the Palace of Versailles in Paris, formally ending the war.

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As per the guidelines 4 subparts of first question is complete.


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