Hypothetical conversation between three economists

Assignment Help Business Management
Reference no: EM131608096

Consider the following hypothetical conversation between three economists about the effects on the economy of a permanent increase in direct taxes on labour income:

ECONOMIST 1: "This policy is contractionary and disinflationary, but only in

the short run."

ECONOMIST 2: "The tax increase will have an inflationary effect that will make

the central bank put the brake on the real economy. Most of the contractionary effect will be permanent."

ECONOMIST 3: "This measure will not have any effect on inflation and, there- fore, no consequences for monetary policy will follow."

Go to the macroeconomic simulator accompanying the Carlin and Soskice text- book. Use the closed economy version and make sure you start from scratch, that is all shocks are reset.

In the simulator, implement the appropriate shock(s) and evaluate the validity of each economist's claim. Can you reconcile their different views? (Hint: consider that this policy may have both demand and supply effects.)

Reference no: EM131608096

Questions Cloud

Determine the new balance exceeds the customers credit limit : (Credit Limit Calculator) Develop a C program that will determine if a department store customer has exceeded the credit limit on a charge account.
Remedy of specific performance : When would the high cost of contractual performance make the remedy of specific performance more optimal than expectation damages?
Explain ethics requires that a company carries : Ethics requires that a company carries out itself in a professional manner espoused on their vision and mission statements
Calculate the profit maximizing output : (a) Calculate the profit maximizing output and price of the monopolist. Calculate the resulting profit.
Hypothetical conversation between three economists : Consider the following hypothetical conversation between three economists about the effects on the economy of a permanent increase in direct taxes.
How much should the stocks of savoy and expo change in value : If the S&P 500 goes up by 21.8721.87 percent, how much should the stocks of Savoy, Hokie, Graham, and Expo change in value?
Develop a program that will input the miles driven : Drivers are concerned with the mileage obtained by their automobiles. One driver has kept track of several tankfuls of gasoline by recording miles driven.
Using supply and demand graphs : Using supply and demand graphs, show how product liability, a branch of comparative negligence law, affect the supply and demand for products.
Economic arguments applicable to m positions : Parties should be free to trade as they wish, subject only to the law of contract. Discuss the economic arguments applicable to M positions.

Reviews

Write a Review

Business Management Questions & Answers

  Caselet on michael porter’s value chain management

The assignment in management is a two part assignment dealing 1.Theory of function of management. 2. Operations and Controlling.

  Mountain man brewing company

Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. Due to increase in the preference for light beer drinkers, Chris Prangel wants to introduce light beer version in Mountain Man. An analysis into the la..

  Mountain man brewing company

Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. An analysis into the launch of Mountain Man Light over the present Mountain Man Lager.

  Analysis of the case using the doing ethics technique

Analysis of the case using the Doing Ethics Technique (DET). Analysis of the ethical issue(s) from the perspective of an ICT professional, using the ACS Code of  Conduct and properly relating clauses from the ACS Code of Conduct to the ethical issue.

  Affiliations and partnerships

Affiliations and partnerships are frequently used to reach a larger local audience? Which options stand to avail for the Hotel manager and what problems do these pose.

  Innovation-friendly regulations

What influence (if any) can organizations exercise to encourage ‘innovation-friendly' regulations?

  Effect of regional and corporate cultural issues

Present your findings as a group powerpoint with an audio file. In addition individually write up your own conclusions as to the effects of regional cultural issues on the corporate organisational culture of this multinational company as it conducts ..

  Structure of business plan

This assignment shows a structure of business plan. The task is to write a business plane about a Diet Shop.

  Identify the purposes of different types of organisations

Identify the purposes of different types of organisations.

  Entrepreneur case study for analysis

Entrepreneur Case Study for Analysis. Analyze Robin Wolaner's suitability to be an entrepreneur

  Forecasting and business analysis

This problem requires you to apply your cross-sectional analysis skills to a real cross-sectional data set with the goal of answering a specific research question.

  Educational instructional leadership

Prepare a major handout on the key principles of instructional leadership

Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd