Economists who are skeptical of the Fed's ability to fine tune the economy argue that lags in the effect of monetary policy make it difficult to properly time this policy. monetary policy only affects output in the long run. Fiscal policy affects output more quickly than monetary policy. Monetary policy does not have any effect on output.

OMOs are the buying and selling of Gov’t bonds. Explain the relationship between the Gov’t bonds and the FED in relation to this macro tool.

Let’s study the crowding-out effect which is triggered by a discretionary fiscal policy. How does a temporary increase in government purchase affect the interest rate based on the money supply-demand model? Why? Suppose we are having stagflation because of a supply shock. Please show the temporary increase in government purchases can restore the long-run macroeconomic equilibrium using a graph. What is the meaning of the crowding-out effect? Please show the short-run crowding out effect using a graph.

Explain the difference between fiscal policy and monetary policy. Explain also 2 advantages and 2 disadvantages of both policies.

In the most recent FOMC meeting, the Federal Reserve increased the Federal Funds rate. By doing this, this suggests the Federal Reserve: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. is willing to sacrifice higher prices to save jobs a is willing to sacrifice jobs to keep prices stable is trying to counter fiscal policy actions d believes the Federal Funds rate is not important

Suppose that government spending is increased at the same time when an autonomous monetary policy tightening occurs. What will happen to the position of the aggregate demand curve?

Question: A recent article (federalreserve.gov/econres/feds/files/2020049pap.pdf) published by the Federal Reserve (the central bank of the USA), suggests "the massive lockdown of the economy" has led to "a large negative demand shock. However, an accompanying increase in unemployment benefits has increased the income of some low-and middle-income households at least temporarily, which could helpfully support aggregate demand". The excerpt above suggests an increase in household income, which might lead to improved aggregate demand. a. Draw a diagram to explain the above situation to show the impact of increased income and how it affects aggregate demand.

Fiscal policy is conducted by the U.S. Treasury the U.S. Mint the federal government the Federal Reserve bank and involves government spending and taxes. quantitative easing. printing money. open market operations.

Review the rubric to make sure you understand the criteria for earning your grade. Read the articles An Update on the Economy and Monetary Policy and Recent and Near-Term Fiscal Policy Write a five- to six-page paper answering the following regarding fiscal and monetary policy changes: Explain the key aspects of today’s monetary policy and how they are affecting GDP and aggregate demand/aggregate supply. Explain the key aspects of today’s fiscal policy and how they are affecting GDP and aggregate demand/aggregate supply. Are these policies being well coordinated today? In essence, are they both working in unison to address current economic conditions? Explain. What are these policies’ effects on aggregate supply and aggregate. Do understand they affect supply as well as demand. You must use a minimum of five sources for your research paper, at least three of which are scholarly. Use proper spelling, grammar, and APA formatting for your analysis paper. When you have completed your…

What does a positive output gap indicate about the economy? The economy has slack, and the Central Bank will be on the lookout for deflation. The economy is running below its potential, and the Central Bank will be on the lookout for inflation. The economy is running above its potential and the Central Bank will be on the lookout for inflation.