Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Do you think the Fed's recent changes to explicitly tie the next policy moves to the unemployment rate and forecasts of future inflation is a move towards a more optimal monetary policy?
Here is a 2012 version of the answer:
The Fed's dual mandate to help guide "optimal policy" is rare among central banks. It includes both inflation (the usual solo goal) and economic performance. The Fed adopted a numerical 2% inflation target in the last few years and then added a new target of the unemployment rate target and forecasted inflation in December 2012. They argued that interest rates should remain low until either the unemployment rate fell below 6.5% and/or the forecasted (core) inflation rate rose above 2.5%.
While there is no right answer to this question. On the surface, this approach is more numerical and "model based" and should be applauded for its increased transparency. But will increased transparency lead to policy clarity? There are a lot of moving parts-current unemployment and inflation rates as well as future inflation rates. Should we trust the Fed's models and forecasts, particular over long periods of time? For example, one could argue that this new policy guidance is a generous interpretation of the Taylor Rule and could be inflationary. A simple Taylor rule with 6.5% unemployment, a 5% natural rate and a 2.5% inflation rate (2% target) could suggest interest rates closer to 2% than the zero suggested by the Fed.
A welfare system in which benefits take the form of cash payments to recipients is preferable to one based on the use of price subsidies on merit goods. Discuss this statement using consumer theory to illustrate your arguments.
What is a perfectly competitive market and what are the assumptions of a perfectly competitive market?
A firm has the opportunity to invest in a project having an initial outlay of $20,000. Net cash inflows (before depreciation and taxes) are expected to be $5,000 per year for five years. The firm uses the straight-line depreciation method with a zero..
Assume re is a multiplier effect and that total crowding-out effect is $6 billion. An increase in government purchases of $10 billion will shift aggregate demand to left or right by how much.
The American people express a relatively high degree of confidence in the military as an institution yet express less confidence in Congress than in other major institutions. Could people be holding various institutions to different standards, and if..
Let us for now ignore the problem of linear zing around zero-growth-rate, and assume that there is no problem in modelling constant natural growth rate. Let us suppose that monetary shock occurred, due to stochastic or forecast errors or intentional ..
Annual sales of a given product are 8,000 units; the selling price is $8 per unit. Annual fixed production costs are $6,000 and the current annual profit is $18,000. The company is planning to invest to influence the sale of its product. Sales are ex..
In about 500 words, From a geographical standpoint, why is SPACE so integral to the survival of Capitalism as an economic system?
How to do Empirical Investigation part of my project. my project as on Volkswagen company and this stage is the last stage. while in this stage my professors want to do empirical study which should include the following things. Planned research metho..
Another utilization of cash flow analysis is setting the bid price on a project. To calculate the bid price, we set the project NPV equal to zero and find the required price. Thus the bid price represents a financial break-even level for the project...
Could differences across countries in population growth rates account for the persistence in income disparity across countries? Use the Solow growth model to address this question and discuss.
What is the equilibrium quantity and equilibrium price for the following demand and supply curves: Calculate consumer and producer surplus in this market.
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd