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1. Using IS/LM, aggregate demand and aggregate supply model of the economy, show that monetary policy is effective in the short run but it is neutral ( ineffective) in the long run. In the same context, identity conditions which you would recommend "activist" do under monetary policy.
2. Derive and explain IS and LM curve
3. Compare the effect of both an unanticipated and anticipated increase in the money supply upon a rational expectations model and a new Keynesian model.
4. Briefly outline why Baumol's "The Transactions Demand for Cash" is a further development in the Keynesian approach to the demand for money.
5. Explain how the quantity theory of money and the classical Cambridge approach evolved into two very different approaches with regard to the demand for money.
Consider the marketplace for personal computers. Suppose that the demand is stable: the demand curve doesn't change.
Assume the Federal Reserve sells government securities from its existing holdings to the financial sector and the non-bank public.
short answer questions1. explain the law of diminishing marginal utility. why does it occur?2. the value of cross price
if unit labor costs in Spain and Portugal rise, but unit labor costs in Germany decline and other producer prices remain unchanged, what effect should these factors by themselves have on export trade and why
Most macroeconomists believe it is a good thing that taxesact as automatic stabilizers and lower the size of themultiplier. However, a smaller multiplier means that the change ingovernment purchases of goods
Suppose that you are the chief economic advisor to the president of the United States. You are asked to propose a strategy to bring the economy out of recession. Unemployment is at 13 percent and inflation is relatively low. Your goal is to avoid an ..
Illustrate what does, and what doesn't, the Solow model tell us about the sources of economic growth and the best policies for attaining high per capita incomes.
An increase in the demand for LED light bulbs due to changes in consumer tastes, accompanied by an increase in the supply of LED light bulbs as a result of government subsidies, will result in
Suppose that the price of the product is $5. How many units will the firm produce in the short run? In the long run, will the price rise or fall from the current level at $5? Explain the reason
While browsing internet, what do we call the area of storage that compensates for the different speeds of data flow or timings of events by temporarily holding a block of data that is waiting to be processed?
What are the functions of money? Why is money better than the barter system? Why do people hold money? What affects our demand for money?
Illustrate what the government should do about it, how would each economist explain unemployment and what policies would each advocate.
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