Reference no: EM13979285
Assume that Janet Yellen (chair of the US Fed Reserve) decides to reduce the US money supply (i.e., contractionary monetary policy).
1) Using the concept of money market equilibrium, explain what will happen to interest rates and prices in the U.S. in the short-run.
2) Using the concept of interest-rate parity explain what will happen to the exchange rate of the dollar in the short-run (i.e., will it appreciate or depreciate?).
3) Given your answers to (1) and (2), do you think this policy is designed to stimulate the economy (i.e., increase production in the U.S. in the short-run)? Explain.
4) Using the concept of money market equilibrium, explain what will happen to interest rates and prices in the U.S. in the long-run.
5) Using the concept of purchasing-power parity explain what will happen to the exchange rate of the dollar in the long-run (i.e., will it appreciate or depreciate?).
6) Given your answers to (4) and (5), do you think this policy is designed to stimulate the economy (i.e., increase production in the U.S. in the long-run)? Explain.
|
Business week section business exchange
: Step - 1: Review this article from on line Business Week Section Business Exchange: Harness the Power of Marketing
|
|
Three major causes of inequality of income
: Three major causes of inequality of income. Describe what the primary factors are that lead to poverty. We have learned there are two solutions to reduce poverty. We could expand welfare and redistribution programs, and make taxes more progressive. C..
|
|
Discuss the structure of the horse industry
: Compare and contrast it with the other animal industries discussed thus far. Please discuss two things your learned or found interesting during your tour of the OSU Horse Center.
|
|
How do they then interfere
: During interference in thin flims colours appear due to interference between the light waves reflected from the top and bottom surfaces of the thin film. But the waves reflected or transmitted are parallel to each other. How do they then interfer..
|
|
Using the concept of money market equilibrium
: Assume that Janet Yellen (chair of the US Fed Reserve) decides to reduce the US money supply (i.e., contractionary monetary policy). Using the concept of money market equilibrium, explain what will happen to interest rates and prices in the U.S. in t..
|
|
Define sexual harassment
: What are some potential threats that reduce cooperation and negatively affect workforce diversity? Define sexual harassment and describe the three main ways to prove it
|
|
Find the acceleration of block
: Inthe figure below, the pulleys and the cord are massless, all surfaces are frictionless, and the cord does not compress or stretch. How does the acceleration of block 1 compare with the acceleration of block 2? Report your answer in terms of the r..
|
|
How many will be unemployed
: If the minimum wage is set at $100, how many will be unemployed? If the minimum wage is equal to $125, what is the quantity of labor supplied, the quantity of labor demanded, and number unemployed?
|
|
Prisoners dilemma game is difficult to maintain
: Cooperation between the two prisoners in the prisoners’ dilemma game is difficult to maintain, because. Assuming competitive markets, a worker’s contribution to revenue is given by the. The business-stealing externality associated with monopolistic c..
|