Reference no: EM133215278
FYI: Milton Friedman, who passed away in 2006 in California, was a professor of economics at University of Chicago for many years. He was awarded the 1976 Nobel Memorial Prize in Economics for his contribution to consumption analysis and to monetary history and theory. He was famous for being very articulate and explaining even the most complicated matters in easy-to-understand terms. To see what he looked and sounded like, take a look at the following short clip from the 70s:
a) Explain the quantity theory of money. How does the quantity theory of money relate to Milton Friedman's famous statement that "Inflation is always and everywhere a monetary phenomenon?"
b) In the "Classical Theory of Inflation", what determines the price level and the value of money? Explain using a supply and demand plot.
c) Now using your supply and demand plot from part-b of this question, illustrate the impact of an expansionary monetary policy on the inflation rate and the price level. For full credit, also do explain how the transition process works from the initial equilibrium to the final equilibrium.
d) What is meant by the phrase "Money is neutral in the long run"? (in other words, what is monetary neutrality?). Explain by using the quantity equation.
e) What is the Fisher equation? What relationship does it represent?
|
Why according to john cochrane economic growth
: "From 1950-2000 the US economy grew at an average rate of 3.5 percent annually. Since 2000 it has grown at half of that rate 1.67 percent. America's foremost ec
|
|
Promote the keystone oil pipeline
: Alberta premier, Jason Kenney, has recently made a trade mission to Washington to promote the Keystone oil pipeline which would transport oil from Alberta to th
|
|
How does risks connect to economic growth
: In a paragraph, summarized the outlook on the world economic outlook July 2022 update and what are the risks to global economic growth, summarized on each of th
|
|
Classical theory of inflation
: a) In the "Classical Theory of Inflation", what determines the price level and the value of money? Explain using a supply and demand plot.
|
|
Explain the quantity theory of money
: FYI: Milton Friedman, who passed away in 2006 in California, was a professor of economics at University of Chicago for many years. He was awarded the 1976 Nobel
|
|
First national bank of pandesia
: Now suppose the Central Bank of Pandesia (CBP) decides that after centuries of 100-percent-reserve banking, it is time for a change and decide to switch the Pan
|
|
Changes the money supply in pandesia
: Suppose I live in a hypothetical country, Pandesia, where there is 100-percent-reserve banking. I deposit $1,000 in a checking account at the First National Ban
|
|
Price level in a country and the value of money
: What is the relationship between the price level in a country and the value of money in that country?
|
|
Connection between our studies and the article
: You are to 'connect' a situation and information from a current news article to the economic theories and concepts we have studied in class. What is the connect
|