1 imf orders country a to cut its budget by 25 and reduce

Assignment Help International Economics

Reference no: EM13375879

1) IMF orders country A to cut its budget by 25% and reduce the value of its currency by 40%. Before these changes the country had a GDP of 4000 billion and a G of 1200 billion, a trade deficit of 300 billion and a C of 2000 billion. After the IMF suggestions the following changes were noticed: a trade surplus of 100 billion, a reduction in C of 5%, and an increase in I of 50%. What is country A's GDP after the IMF orders were implemented?

2) Country X has a balanced budget, an actual GDP of 15,500 billion and a gap to potential GDP of 1000 billion. There are 2 political parties: the Bronze Age Party which recommends to cut taxes by 400 billion if elected, and the Spend Happy Party which suggests a 500 billion budget deficit. a) what will be the inflation rate if the Bronze Age Party wins and implements its platform? b) What will be the inflation if the Spend Happy Party wins and implements its platform?

3) Country A is on the PPF. It decides to run a budget deficit of 100 billion. Both its potential and actual GDP is 800 billion. What will happen if country A decides to run this deficit? And why? Give a full explanation for this expected result.

Reference no: EM13375879

Questions Cloud

Q1 price elasticity of demand depends on various factors : q.1 price elasticity of demand depends on various factors. explain each factor with the help of an example.q.2 show how

The world bank is currently advising newly industrialized : the world bank is currently advising newly industrialized countries on how to encourage growth and they have asked for

Brian and kim own a business employing 8 workers to produce : brian and kim own a business employing 8 workers to produce commemorative t-shirts for campus organizations and events.

1 conservative commentators in the us often attribute the : 1. conservative commentators in the us often attribute the slow recovery to market concerns about what obama might do

1 imf orders country a to cut its budget by 25 and reduce : 1 imf orders country a to cut its budget by 25 and reduce the value of its currency by 40. before these changes the

1 find the capitalized cost of a present cost of 330273 : 1. find the capitalized cost of a present cost of 330273 annual costs of 41182 and periodic costs every 5 years of

The macdougall family runs a 180 head self-replacing : the macdougall family runs a 180 head self-replacing commercial charolais enterprise on 800 hectares near mendooran

1 if there are diminishing returns to the variable input : 1. if there are diminishing returns to the variable input will average variable cost necessarily increase with increase

A how would a regular lm curve be affected if the private : a how would a regular lm curve be affected if the private sector demand for money balances increased following

User Account

All Pages