Last names beginning with K-O: Assume that you are the Fed Chairman and that the country...

Last names beginning with K-O:

Assume that you are the Fed Chairman and that the country is experiencing a recession. What type of monetary policy would you enact in order to address the recession? Be specific with your policy recommendations. What would happen to the money supply, the interest rate, equilibrium GDP, inflation, and unemployment as a result of your actions? Why?

Last names beginning with P-Z:

Assume that you are the Fed Chairman and that the country is experiencing a high rate of inflation. What type of monetary policy would you enact in order to address the inflation? Be specific with your policy recommendations. What would happen to the money supply, the interest rate, equilibrium GDP, inflation, and unemployment as a result of your actions? Why?

Solutions

Expert Solution

if the country is experiencing a recession as a chairman of fed i will employ expansionary monetary policy to increase money supply in the economy. expansionary monetary policy simply brings the rate of interest down to promote investment in the economy. increased investment creates employment and increases income for prople. with higher income people demand goods and services which further creates base for investment. output and total gdp increases in the economy. unemployment declines and money supply further increases which combats the recessionary situation. so expansionary monetary policy will fairly work.

if the country is facing a high rate of inflation then as a chairman of fed i will employcontrationary monetry policy. it will push the rate of interest rate to go up, which will restrict the investment demand. there will be less investment in the economy and so will be the rate of employment. unemployment rate will increase and the money income of people will decline. this will lower the demand for gooda and services and the demand for money as well. low demand for money will pull the inflation rate to down so here contrationary monetary policy will work perfectly fine. gdp and the totl output will decrease as well.

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

Last names beginning with A-E: Assume that you are the U.S. president and that the country...

Last names beginning with A-E: Assume that you are the U.S. president and that the country is experiencing a recession. What type of fiscal policy would you enact in order to address the recession? Be specific with your policy recommendations. What would happen to equilibrium GDP, inflation, and unemployment as a result of your policy recommendations? Why? Last names beginning with F-J: Assume that you are the U.S. president and that the country is experiencing a high rate of inflation....

Assume that you are one of Fed governors working with Fed Chairman Powell on monetary policy....

Assume that you are one of Fed governors working with Fed Chairman Powell on monetary policy. What will be your advice on interest rates to him? Would you decrease the Federal Fund Rate in the coming months with a concern that the economy is in a recession?

2. Imagine that you are elected the Chairman of the Fed and your goal is to...

2. Imagine that you are elected the Chairman of the Fed and your goal is to keep both unemployment and inflation under control. This means that unemployment should be at its natural rate (e.g. 5%) and inflation at/around 2%. Can you achieve the two goals simultaneously? Why or why not? Explain in detail.

Assume the current Fed Chairman tries to impress the President and sets a short-term interest target....

Assume the current Fed Chairman tries to impress the President and sets a short-term interest target. Explain how (or if) he can still control inflation in the long run.

. Assume you are the chairman of the Board of Governors of the Federal Reserve. The...

. Assume you are the chairman of the Board of Governors of the Federal Reserve. The economy is in the midst of a recession. What type of monetary policy would you advocate? What tools would you use to implement said policy? Be specific in your response as to how the tools would work to accomplish your objectives.

Suppose a professor splits their class into two groups: students whose last names begin with A-K...

Suppose a professor splits their class into two groups: students whose last names begin with A-K and students whose last names begin with L-Z. If p1 and p2 represent the proportion of students who have an iPhone by last name, would you be surprised if p1 did not exactly equal p2? If we conclude that the first initial of a student's last name is NOT related to whether the person owns an iPhone, what assumption are we making about the...

Suppose a professor splits their class into two groups: students whose last names begin with A-K...

Question 7 a) If you were the Chairman of a professional sports team in your country,...

Question 7 a) If you were the Chairman of a professional sports team in your country, what different types of incentives would you offer to the players in addition to their flat salary?

. Let K(t) denote the quantity of capital a country has at the beginning of period...

. Let K(t) denote the quantity of capital a country has at the beginning of period t. Also, assume that capital depreciates at a constant rate d, so that dK(t) of the capital stock wears out during period t. If investment during period t is denoted I(t), and the country does not trade with the rest of the world, then we can say that the quantity of capital at the beginning of period t+1 is given by K (t +...

In the previous question if you expect o receive the payment at the beginning of the...

In the previous question if you expect o receive the payment at the beginning of the year instead of the end of they year, how much the payments are worth now?

Subjects