increasing interest rates
... shortages of gasoline and other refined products) caused a leftward shift in aggregate supply, causing inflation to rise while output fell. Hence the second episode of stagflation. ...
... shortages of gasoline and other refined products) caused a leftward shift in aggregate supply, causing inflation to rise while output fell. Hence the second episode of stagflation. ...
... c) [6 marks] With the consumption function as in (b) above, in the absence of fiscal policy, would monetary policy be an effective alternative? By how much should the money supply be increased? d) [6 marks] Now suppose that wages and prices were perfectly flexible and full employment national income ...
Dr. Yetkiner when he is young and
... 3. (20 Points) Suppose that there was a very strong earthquake in the North-West of Turkey and 20% of Turkey’s physical capital stock is lost. In return, policy makers increased money supply aiming to stimulate economy and to recover from the negative effects of the capital loss. Evaluate the macroe ...
... 3. (20 Points) Suppose that there was a very strong earthquake in the North-West of Turkey and 20% of Turkey’s physical capital stock is lost. In return, policy makers increased money supply aiming to stimulate economy and to recover from the negative effects of the capital loss. Evaluate the macroe ...
Macro Economic Variables/Indicators
... Negative slope, ADL shows different amounts of labor at different wage rates W/P W* ...
... Negative slope, ADL shows different amounts of labor at different wage rates W/P W* ...
Economics for Managers SYLLABUS UNIT 1 INTRODUCTION TO MANAGERIAL ECONOMICS
... Method to calculate GDP in India ...
... Method to calculate GDP in India ...
Chapter 8 Presentation - Kellogg Community College
... Concept 1: Classical View of Business Cycles Flexible prices refers to the belief that when demand for goods and services slows, the prices will drop until demand rises again. Flexible wages refers to the belief that as demand falls and more workers are laid off, the increased competition for jobs ...
... Concept 1: Classical View of Business Cycles Flexible prices refers to the belief that when demand for goods and services slows, the prices will drop until demand rises again. Flexible wages refers to the belief that as demand falls and more workers are laid off, the increased competition for jobs ...
... to Patinkin, creating a "modified general equilibrium" model along Walrasian lines as a response to overcome the aforementioned coordination problem (Snowdon & Vane, 2005). However, Clower and Leijonhufvud differed in their interpretation of Keynes' work, which materialized in a 'family quarrel' abo ...
The Confidence Fairy in Historical Perspective
... metaphysical necessity of the case, be an exact equipoise to each other; and if there be more sellers than buyers of one thing, there must be more buyers than sellers for another.... If, however, we suppose that money is used, these propositions cease to be exactly true.... What they called a genera ...
... metaphysical necessity of the case, be an exact equipoise to each other; and if there be more sellers than buyers of one thing, there must be more buyers than sellers for another.... If, however, we suppose that money is used, these propositions cease to be exactly true.... What they called a genera ...
Macroeconomic Analysis Econ 6022
... - Keynesians think aggregate demand shocks are the primary source of business cycle fluctuations - Aggregate demand shocks are shocks to the IS or LM curves, • Examples: - fiscal policy, - changes in desired investment arising from changes in the expected future marginal product of capital, - change ...
... - Keynesians think aggregate demand shocks are the primary source of business cycle fluctuations - Aggregate demand shocks are shocks to the IS or LM curves, • Examples: - fiscal policy, - changes in desired investment arising from changes in the expected future marginal product of capital, - change ...
63 “KEYNESIANS”, MONETARISTS, NEW CLASSICALS AND NEW
... Therefore, Hicks concludes that “... the General Theory of employment is the Economics of Depression” (ibid., p. 155). As a result of this Hicksian conclusion, the Keynes’s theory was interpreted as the situation in which unemployment is only a temporary phenomenon due to the existence of the liquid ...
... Therefore, Hicks concludes that “... the General Theory of employment is the Economics of Depression” (ibid., p. 155). As a result of this Hicksian conclusion, the Keynes’s theory was interpreted as the situation in which unemployment is only a temporary phenomenon due to the existence of the liquid ...
Keynesian Theory
... Classical viewpointnot possible to overproduce goods because the production of those goods would always generate a demand that was sufficient to purchase the goods. (what would they say about the recent inventories of our auto industry?) ...
... Classical viewpointnot possible to overproduce goods because the production of those goods would always generate a demand that was sufficient to purchase the goods. (what would they say about the recent inventories of our auto industry?) ...
Business Cycle Theories
... stabilising real GDP under some conditions. The classical economists assumed that the economy would not operate with real GDP (Y) away from the level of natural real GDP (Y N ) for any length of time: if Y < Y N , then firms would be producing at below capacity, and would tend to cut nominal wages a ...
... stabilising real GDP under some conditions. The classical economists assumed that the economy would not operate with real GDP (Y) away from the level of natural real GDP (Y N ) for any length of time: if Y < Y N , then firms would be producing at below capacity, and would tend to cut nominal wages a ...
Power Point Slides Fifteen: Worldly Philosophers Ch. 9
... produced, in what proportions the factors of production will be combined to produce it, and how the value of the final product will be distributed between them.” Keynes believed that once full employment had been achieved by FISCAL POLICY measures, the market mechanism could then operate freely. “Th ...
... produced, in what proportions the factors of production will be combined to produce it, and how the value of the final product will be distributed between them.” Keynes believed that once full employment had been achieved by FISCAL POLICY measures, the market mechanism could then operate freely. “Th ...
Final Exam
... neoclassical theoretical framework and why the inability to define capital fatally undermines the marginal productivity theory (no graph is required). A meaningful concept of capital is not only essential for marginal productivity theory, but also essential for the other two fundamental tenets of ne ...
... neoclassical theoretical framework and why the inability to define capital fatally undermines the marginal productivity theory (no graph is required). A meaningful concept of capital is not only essential for marginal productivity theory, but also essential for the other two fundamental tenets of ne ...
Theories and AD-AS
... • Say’s Law: Supply creates its own Demand • Predominant economic theory until 1930’s ...
... • Say’s Law: Supply creates its own Demand • Predominant economic theory until 1930’s ...
Progress in Economics
... During Great Depression the Federal Reserve allowed the US money supply to fall by a third ...
... During Great Depression the Federal Reserve allowed the US money supply to fall by a third ...
Chapter 12 - University of Alberta
... Comparing Monetary and Fiscal Policy (continued) • Easy fiscal policy expands output through the multiplier effect and despite the effect of fiscal policy on the interest rate. • Easy fiscal policy increases interest rate and crowds out both consumption and ...
... Comparing Monetary and Fiscal Policy (continued) • Easy fiscal policy expands output through the multiplier effect and despite the effect of fiscal policy on the interest rate. • Easy fiscal policy increases interest rate and crowds out both consumption and ...
Macro Ideas and Theories - Great Valley School District
... Economic Research has tracked the U.S. business cycle back to 1854. There are constraints to how far back in time the business cycle can be analyzed, primarily due to limited data, inaccuracy of data, and the infrequency of business cycles occurring prior to the mid-1850s.) The End of the Great Depr ...
... Economic Research has tracked the U.S. business cycle back to 1854. There are constraints to how far back in time the business cycle can be analyzed, primarily due to limited data, inaccuracy of data, and the infrequency of business cycles occurring prior to the mid-1850s.) The End of the Great Depr ...
Name IAS 107 Fall 2013 Instructor: Mario Muzzi Problem Set #5
... effects of a debt-financed tax cut on: i) Current Consumption ii) Current National Savings iii) Current Interest rates 5) (6pts) Open Economy: Assume that in a small open economy where full employment always prevails, national saving is 300. a) (2pts) If domestic investment is given by I = 400 – 20r ...
... effects of a debt-financed tax cut on: i) Current Consumption ii) Current National Savings iii) Current Interest rates 5) (6pts) Open Economy: Assume that in a small open economy where full employment always prevails, national saving is 300. a) (2pts) If domestic investment is given by I = 400 – 20r ...
Notes on government policy
... Another example of manipulation is that pressure groups may ask politicians to pass special laws that favor that group with special tax breaks or spending. Politicians can frame these taxes and expenditures as activist fiscal policy, but it’s really just a political pay-off. That pressure groups exp ...
... Another example of manipulation is that pressure groups may ask politicians to pass special laws that favor that group with special tax breaks or spending. Politicians can frame these taxes and expenditures as activist fiscal policy, but it’s really just a political pay-off. That pressure groups exp ...
Chapter 13
... U.S. Economic History The Zero’s and the Teens The first two decades had some important economic events. First was the Financial Panic of 1907, followed by the creation of the Federal Reserve System and the income tax. World War I of 1917-19 closed the teens. The Roaring Twenties The best economic d ...
... U.S. Economic History The Zero’s and the Teens The first two decades had some important economic events. First was the Financial Panic of 1907, followed by the creation of the Federal Reserve System and the income tax. World War I of 1917-19 closed the teens. The Roaring Twenties The best economic d ...
Classical
... 10. State the individual and aggregate versions of Say’s Principle. Upon the basis of Say’s Principle, discuss both of the following: “A general glut of commodities is impossible.” “Aggregate demand always equals aggregate supply.” Suppose we have a model of the economy in which the only commodities ...
... 10. State the individual and aggregate versions of Say’s Principle. Upon the basis of Say’s Principle, discuss both of the following: “A general glut of commodities is impossible.” “Aggregate demand always equals aggregate supply.” Suppose we have a model of the economy in which the only commodities ...
Long-Run Macroeconomic Equilibrium
... economy a decade or longer to self-correct Economists like Keynes believe in active stabilization, use of government policy to reduce the severity and length of recessions or to rein in excessive expansions ...
... economy a decade or longer to self-correct Economists like Keynes believe in active stabilization, use of government policy to reduce the severity and length of recessions or to rein in excessive expansions ...