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a. based on the functions of the banking system, give reasons why governments bail out banks during an economic crisis
b. is the world heading for recession? explain the conditons under which the world can be classified as being in a recession as COVID- 19 persists. Explain linking the pandemic to the various stages of a recession
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- Is the World heading for a recession? Explain the conditions under which the world can be classified as being in a recession as COVID-19 persists. Explain linking the pandemic to the various stages of a recession.Financial Crises have Adverse effects on the Economies. Write a Comprehensive Note on the causes and consequences of Financial CrisesYou read a news story blaming the central bank for pushing the economy into recession. The article goes on to mention that not only has output fallen below its potential level, but that inflation has also risen. If you were to respond defending the central bank, what argument would you make? Explain in detail.
- Which of the following statement(s) are true? In the situation of sovereign-debt crisis, the government can typically easily and cheaply borrow from the international market. In the situation of a financial crisis accompanied by the existence of healthy financial system, the central bank needs to start lending massively. Financial crises are always the product of real condition of the economy which is bad short before the crises breaks out. If the risk factors can be identified, it can be predicted with a high degree of certainty when a financial crisis will happen.Required: d) True or False: When the peg is credible, recession will have a smaller adverse impact on the economy.Explain the Currency crisis, Banking Crisis and Foreign Debt Crisis
- If the world experienced a global depression accompanied by stable prices and countries’ central banks followed strict policy rules to limit inflation then the banks are likely to substantially increase the global supply of money in response to the depression depreciate the nations’ currency values increase bank reserve requirements to promote safety and stability None of the aboveExplain why a credit crunch occurs in particular why it often occurs after afinancial crisis.How do you relate development of global value chains in global economy and the causes of 2008 financial crisis ? Did government responses sufficient to prevent another crisis? If not, what do you suggest as plausible measures?
- The size of a country’s national debt should not be of much economic concern as long as:a. the debt does not lead to rising inflation.b. the debt is funded from international sourcesc. the general population hoards treasury billsd. it increases at a slower rate than GDP doesConditions under which the world can be classified as being in a recessionQ (B) Which of the following statements about central bank objectives are true? A. Central banks can have several objectives, but their actions need to provide a “nominal anchor” for the economy B. All statements are true C. A strict inflation target is a way to provide a “nominal anchor” for the economy D. In principle, one of the goals of a central bank could be to slow down climate change