What is classical dichotomy

Assignment Help Macroeconomics
Reference no: EM131334489

Part A) What is 'Classical Dichotomy'? What is the neutrality of money? Are the two related? If so,how are they related? What are the major economic and political conclusions of 'Classical Dichotomy'?

5) Part B) Do Classical Dichotomy and Neutrality of money exist in the Keynesian model? (Use the AD-AS or IS-LM models for the purpose of analysis). How do the economic and political conclusions of the Keynesian model differ from those of the classical model on account of this? Explain your answer in detail.

[Hint: Explain the major changes in assumptions about the labour and money markets that lead to the lack of existence of the classical dichotomy and money neutrality in the Keynesian model and how they relate to economic and political conclusions of the Keynesian model]

Reference no: EM131334489

Questions Cloud

Choice of three retirement planning investments : Determine, for each of the given number of years, which of these investments is the best for Dixon if he plans to make one payment today into one of these funds and to retire in the following number of years.
Discuss the pricing policy of price discrimination : Discuss the pricing policy of price discrimination.  Provide the economic reasoning for movie theaters, airlines, and many other businesses to charge customers different prices based on time of the day, age, and purchase dates. Why?
Discuss effect of both the size of rate of return and time : What is the least you will sell your claim for if you could earn the following rates of return on similar risk investments during the ten-year period?
What is the probability of occurrence of the worst sequence : What is the probability of occurrence of the worst sequence obtained in (c), assuming that all binary digits are equally probable and independent?
What is classical dichotomy : Part A) What is 'Classical Dichotomy'? What is the neutrality of money? Are the two related? If so,how are they related? What are the major economic and political conclusions of 'Classical Dichotomy'?
Peasants in central and south america : What efforts have been made and by whom to promote alternative crops to peasants in Central and South America?
What are the various measures of dispersion : What are the various measures of dispersion? What are the uses of these measures and what are their limitations? What do each of these measures tell a researcher? A leader or manager?
At what price must the state sell its bonds : If the state bonds are to be competitive with U.S. savings bonds, which pay 8 percent annual interest (compounded annually), at what price must the state sell its bonds?
Industrial organization class : Outline and briefly explain the major elements of the standard used to evaluate industrial performance from the perspective of societal welfare. Based on this standard, rank order the following industries from best to worst. Do not justify your ra..

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

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