The growth in the velocity of M2 has been steady at about 2% since 1950 so we figure it will stay about there for the foreseeable future. Inflation will probably be 5%. We would like the rate of growth of real output to be 4% over the next year. How fast should we let M2 grow?
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- .Why do you think currencies of countries with high inflation rates tend to have forwarddiscounts?Consider two countries, A and B. In A, new technologies (e.g., mobile payment apps and cryptocurrencies) have been enthusiastically adopted by the population, thereby reducing the proportion ofincome that is held as real money balances. Over this period, no such changes occurred in B. Ifthe rate of money growth and the growth rate of real GDP were the same in A and B over thisperiod, then how would the rate of inflation differ between the two countries?Many economists are worried that a high level of budget deficits may lead to inflationary monetary policies inthe future. Could these budget deficits have an effect onthe current rate of inflation?
- N6 How could Venezuela's inflationary problem be resolved once and for all? Consider and remark on the the following solutions, considering what they involve and how effective they might be. a. A full official dollarization b. Adoption of BitCoin or nother crypto currency such as the Petrolo. c. Legislation mandating a balanced budget approved by the Congress and signed into law by the President.1. Supposeyouhave$200,000inabanktermaccount.Youearn5%interestper annum from this account.You anticipate that the inflation rate will be 4% during the year. However, the actual inflation rate for the year is 6%.Calculate the impact of inflation on the bank term deposit you have and examine the effects of inflation in your city of residence with attention to food and accommodation expenses.2. TheAustralianBureauofStatistics(ABS)reportedinMay2017thatthecivilian population in Australia over 15 years of age was 20.8 million.Of this population of 20.8 million Australians, 13.5 million were employed and 0.7 million were unemployed.Calculate Australia’s labor force and the number of people in the civilian population who were not in the labor force? Also, with examples examine the causes of structural unemployment in Australia.Supposeyouhave$200,000inabanktermaccount.Youearn5%interestper annum from this account. You anticipate that the inflation rate will be 4% during the year. However, the actual inflation rate for the year is 6%. Calculate the impact of inflation on the bank term deposit you have and examine the effects of inflation in your city of residence with attention to food and accommodation expenses.
- What happend if a Monetary policy is not effective during recession like as COVID-19 .For a country A, the nominal GDP growth rate is 10 percent and inflation is 4 percent. If the velocity of money remains constant, what is the percent change in real money balances?Suppose growth rate of Real GDP is 6% and the growth rate of velocity is 3%. IfBangladesh Bank wants to have a 5 % inflation rate, what should be the growth rate ofmoney supply according to the predetermined-money-growth-rate-rule? If BangladeshBank increases money supply at a rate that is higher than the rate you found in parta, what will be the impact of that higher than required money growth?
- Discuss the effects of a monetary expansion under COVID-19 conditions. Will it create inflation and economic growth in the short and long term? Use necessary formulas and diagramsWhich institution conducts the monetary policy of the Republic of Turkey and what is theprimary objective of that institution?I want answer with explanation... Only typed answer I want... I'll upvote you... You have 20,000 EUR. The annualized UK interest rate is 4 percent, and the annualized EURO zone interest rate is 2% percent. The current spot rate of the EURO is GBP 0.8. If you expect the spot rate to remain the same after one year, which investment alternative would you choose? How would you structure your transactions? Calculate the gain compared to the second-best alternative if your expectation about the spot rate one year from now turns out to be true.