Federal reserve decides to stabilize the inflation rate

Assignment Help Business Economics

Reference no: EM13982266

Suppose the current administration decides to decrease government expenditures as a means to cut the existing government budget deficit.

A. Using a graph of aggregate demand and supply, show what the effect would be in the short run. Describe the effects on inflation and output.

B. What would be the effect on the real interest rate, inflation rate, and output level if the Federal Reserve decides to stabilize the inflation rate?

Reference no: EM13982266

Questions Cloud

The standard operation time for one particular operation : Production for a product is planned at 5,000 units per week. The standard operation time for one particular operation is 2.45 minutes. The facility operates 40 hours per week. Suppose that there was a fallout of 10% in the operation that proceeds thi..

What result should he get : Starship "Alpha" is traveling at 0.8c (α = 5/3) with respect to the identical starship "Beta." Each starship has rest length 10,000 m. The ship's engineer aboard the "Beta" measures the length of the "Alpha" as it passes by his window. What result..

Compute the per worker form of the production function above : Check your conclusion above by computing the golden rule level of capital stock, and the saving rate necessary to achieve it.

What noteworthy similarities or differences can identified : Compare and contrast the scopes of practice in the licensure laws of licenses professional counselors and licensed clinical social workers in New York state. What noteworthy similarities or differences can be identified

Federal reserve decides to stabilize the inflation rate : Suppose the current administration decides to decrease government expenditures as a means to cut the existing government budget deficit. Using a graph of aggregate demand and supply, show what the effect would be in the short run. Describe the effect..

Contains details in respect of length : Certificate of measurement contains details in respect of length,breadth and height of the packages,size of packing,Is true or False?

State of economy than level of output and inflation rate : Think about all the economic data that are reported in the news every day. The information from all of them may be relevant, but does a policymaker really need to know any more about the state of the economy than the level of output and the inflation..

Untied states and the eu countries : If agricultural tariffs and subsidies to producers were removed overnight, what would the impact be on the average consumer in developed nations such as the Untied States and the EU countries?

Which of the following willshift the demand curve for a good : An "increase in supply" means the supply curve has shifted to the right while an "increase in quantity supplied" means at any given price supply has increased.

User Account

All Pages