PRINCIPLES OF MACROECONOMICS Q1. Explain what are the lags in macroeconomic policies. Do these lags have more effect on monetary policy or fiscal policy and why
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Q: 9.Fiscal policy can be called on to correct conditions of recession and inflation. a.List and…
A:
Q: 5. (Evolution of Fiscal Policy) What did classical economists assume about the flexibility of…
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Q: 2. The graph below shows the AD-AS diagram for Canada. 1200+ 1100+ 1000 AD 900 800 - 700+ 600 +…
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Q: 3. The Keynesian view of fiscal policy Which of the following could cause an increase in the budget…
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Q: esults in a reduction in the budget deficit. This fiscal policy action results in an increase in the…
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Q: QUESTION-2: Fiscal policy cannot affect the level of GDP if money demand does not depend on the…
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Q: 15. Which of the following pairs of terms is used to describe fluctuations in the economy? a) Real…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: 5. Demand side fiscal policy is also known as Keynesian Economic Theory * True O False
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Q: ist the 3 major economic goals of fiscal policy. Who is responsible for fiscal policy?
A: Since you have multiple questions, I would be answering the first two. If you want any specific…
Q: Firstly, explain how monetary and fiscal policy is implemented and how they can be used to influence…
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Q: How is Milton Friedman’s economic theory used in the current (last 20-40 years) fiscal policy? Could…
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Q: )Which of the following statements is most accurate regarding fiscal policy and monetary policy?…
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Q: Directions: Read the following excerpts. Identify whether the policy action is fiscal or monetary…
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Q: 1. Which of the following is a major area of disagreement between activists and nonactivists?…
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Q: a) Assume the economy is in a recession. Discuss how the government could implement fiscal policy…
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Q: The "crowding-out secondary effect expansionary macroeconomic policy a) For fiscal policy it is…
A: The crowding out effect is an economic theory arguing that rising public sector spending drives down…
Q: 10) Fiscal policy is defined as changes in federal ________ and ________ to achieve macroeconomic…
A: Demand is the total quantity of goods and services for which the consumers are willing to pay…
Subject : PRINCIPLES OF
Q1. Explain what are the lags in macroeconomic policies. Do these lags have more effect on
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- Macro Economics 1. Explain how the effectiveness of fiscal and monetary policy depends on whetherthe policy change is initiated at a low or high level of output relative to full-employment output. Make sure to provide your answer with the relevant graphsand mathematical equations.Question: In an economy experiencing stagflation, characterized by simultaneous high inflation and high unemployment, which of the following policy combinations would most likely exacerbate the situation? a) Increasing government spending and reducing interest rates b) Decreasing government spending and increasing taxes c) Implementing tight monetary policy and expanding fiscal policy d) Raising interest rates and reducing government spending10 Within the Keynesian system explain the following: (a) the relationship between the effectiveness of monetary policy and the interest elasticity of investment. Will monetary policy be more or less effective the higher the interest elasticity of investment demand? Now explain the relationship between the effectiveness of fiscal policy and the interest elasticity of investment demand. (b) the relationship between the effectiveness of monetary policy and the interest elasticity of money demand. Will monetary policy be more or less effective the higher the interest elasticity of money demand? Now explain the relationship between fiscal policy and the interest elasticity of money demand.
- 1. The curves showing the various quantities of goods and services that domestic consumers, businesses, the government, and foreign buyers collectively want to buy, at each price level, are the curves for:Choose:a. money supply and money demand b. money supply and aggregate demand c. money demand and aggregate supply d. aggregate demand and aggregate supply 2. Which of the following is an essential factor for the continuous growth process in the economy?Choose:a. research and development of new technologies and investment in new capital b. the absence of private property c. government planning for what the country will produce d. government intervention in economic activity 3. Gross domestic product excludes:Choose: a. consumption and exports b. imports of goods and services c. the inventory of accumulated capital not sold during the year d. the purchase and sale of shares in the financial market(b) Assume that the household in an economy spend 75% of their extra income. Calculate the change of aggregate demand if government increase their spending by $150,000. (c) If prices keep rising, a nightmare scenario for the US economy is a real possibility New York (CNN Business) There's no denying it: Inflation is here. Consumer prices surged 7% over the past year. Housing prices have continued to soar, too. But the question on the minds of many economists and Wall Street strategists is whether something even worse could be in the cards: prices rising as the economy slows. Source: CNN Business, 12" January 2022. Examine the cause of stagflation, and how it affects the output and price level. (d) Based on part (c), what will happen to the output and price level if the US policymakers accommodate the shift in aggregate supply? State only one fiscal policy tool that the policymakers may use.On a microeconomic demand curve, a decrease in price causes an increase in quantity demanded because the product in question is now relatively less expensive than substitute products. Explain why aggregate demand does not increase for the same reason in response to a decrease in the aggregate price level. In other words, what causes total spending to increase if it is not because goods are now cheaper?
- 12. Economic models Suppose an economist believes that the price level in the economy is directly related to the money supply, or the amount of money circulating in the economy. The economist proposes the following relationship: P=A×MP=A×M • P=Price LevelP=Price Level • M=Money SupplyM=Money Supply • A=A composite of other factors, including real GDP, that change very slowly over time.A=A composite of other factors, including real GDP, that change very slowly over time. How might an economist gather empirical data to test the proposed relationship between money and the price level? A- An economist would look for data on past changes in the money supply and note the resulting changes in the price level. B- Economists do not usually develop theoretical models of the economy but only analyze summary statistics about the current state of the economy. C- Unlike researchers in the hard sciences, economists cannot study complex relationships using…directions:Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow Over the past 3 years, prices in Belarus have risen by 4%, as overall economic growth has increased by 5% while unemployment rates are 1.3%. Aram is finding that all goods, even necessities cost more at the stores. He is worried he may have to cut back on certain purchases. Congress and the President also notice this change in the economy and decide to take steps to correct it. They can use their 2 tools in the following ways: a. What will the federal government do to taxes? b. What will the federal government do to government spending? c. What impact will this have on consumer spending?Question 8 Which of the following are true about fiscal and monetary policy? There may be more than one answer. a) A change in tax policies can affect output in the long-run. b) A change in government purchases can affect output in the short-run. c) Since money supply can only affect prices, it can never affect output in the long-run. d) Since money supply can only affect prices, it can never affect output in the short-run.
- 1. Write the definition of Macroeconomics with example? ANSWER: 2. Describe the concept of aggregate demand and aggregate supply? ANSWER: 3. In macroeconomy how and where we will get the equilibrium level with the help of aggregate demand and aggregate supply? ANSWER:Edit question I'm on a real (Online) Assessment right now, need your help and ASSISTANCE So, Please answer Quickly, and concentrate on Answer(s) only 13 The economy is facing difficulty, and economists suggest that a recession has begun. If the market has fallen by 10%, which of the following sectors is most likely to fall less than the market? Utilities Consumer Discretionary Industrials EnergyUse graphical analysis to show how each of the following would affect the economy first in the short run and then in the long run. Assume that the United States is initially operating at its full-employment level of output, that prices and wages are eventually flexible both upward and downward, and that there is no counteracting fiscal or monetary policy.a. Because of a war abroad, the oil supply to the United States is disrupted, sending oil prices rocketing upward. b. Construction spending on new homes rises dramatically, greatly increasing total U.S. investment spending. c. Economic recession occurs abroad, significantly reducing foreign purchases of U.S. exports.