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... Price and wage flexibility are particularly important in the very short run to facilitate the adjustment process following a shock. Alternatively, if nominal prices and wages are downward rigid some measure of real flexibility could be achieved by means of exchange rate adjustments. Capital mobility ...
... Price and wage flexibility are particularly important in the very short run to facilitate the adjustment process following a shock. Alternatively, if nominal prices and wages are downward rigid some measure of real flexibility could be achieved by means of exchange rate adjustments. Capital mobility ...
Review, Chapters 15-17
... Fiscal automatic stabilizers Government spending and taxes that automatically increase or decrease with the business cycle •progressive income tax/unemployment benefits/food stamps / other entitlements Cyclically adjusted budget deficit or surplus The deficit or ...
... Fiscal automatic stabilizers Government spending and taxes that automatically increase or decrease with the business cycle •progressive income tax/unemployment benefits/food stamps / other entitlements Cyclically adjusted budget deficit or surplus The deficit or ...
Lecture 2. Output, interest rates and exchange rates: the Mundell
... • Conditions under which a group of countries may join a fixed exchange rate regime or even adopt a common currency: – They must suffer similar demand shocks same policies in response (symmetric vs. asymmetric shocks); – If they suffer different shocks, they must have high input factors mobili ...
... • Conditions under which a group of countries may join a fixed exchange rate regime or even adopt a common currency: – They must suffer similar demand shocks same policies in response (symmetric vs. asymmetric shocks); – If they suffer different shocks, they must have high input factors mobili ...
Chapter 13 - Personal Home Pages
... → would raise interest rates, → leading to an inflow of foreign capital (loans), → appreciating the currency (higher Y/$), → lowering net exports, → which cancels out the expansionary effect of higher Gov’t spending → leaving the economy at the same level of output. Another part of the story is that ...
... → would raise interest rates, → leading to an inflow of foreign capital (loans), → appreciating the currency (higher Y/$), → lowering net exports, → which cancels out the expansionary effect of higher Gov’t spending → leaving the economy at the same level of output. Another part of the story is that ...
Chapter 14 – Credit and Financial Crises
... a need for money for current transactions, holding precautionary reserves and speculation. Keynes himself believed that the money supply was exogenous, but the post-Keynesians view the money supply as determined by the economy. Expansions increase output, which produces demand-side pressures for mor ...
... a need for money for current transactions, holding precautionary reserves and speculation. Keynes himself believed that the money supply was exogenous, but the post-Keynesians view the money supply as determined by the economy. Expansions increase output, which produces demand-side pressures for mor ...
AP Macro Week 7 Practice Quiz: L – M, #31
... (B) signal participants in financial markets that a recession is coming. (C) signal participants in financial markets that an inflationary period is coming. (D) lower prices in the economy. (E) encourage borrowing by depository institutions so that the money supply may expand. 14. Assume that the Fe ...
... (B) signal participants in financial markets that a recession is coming. (C) signal participants in financial markets that an inflationary period is coming. (D) lower prices in the economy. (E) encourage borrowing by depository institutions so that the money supply may expand. 14. Assume that the Fe ...
Miami Dade College ECO 2013 Section 2 Principles of
... A) a shift to the left of the aggregate demand curve B) a shift to the right of the aggregate demand curve C) a shift to the left of the short-run aggregate supply curve D) supply shift to the right of the short-run aggregate supply curve ...
... A) a shift to the left of the aggregate demand curve B) a shift to the right of the aggregate demand curve C) a shift to the left of the short-run aggregate supply curve D) supply shift to the right of the short-run aggregate supply curve ...
Section 1
... • The current account records net exports of goods and services. • The capital and financial accounts record net exports of assets. • BOP = CA + KA = ΔRFX • Exports are recorded as a credit. • Imports are recorded as a debit. ...
... • The current account records net exports of goods and services. • The capital and financial accounts record net exports of assets. • BOP = CA + KA = ΔRFX • Exports are recorded as a credit. • Imports are recorded as a debit. ...
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... raise significantly the cost of financing as could the failure of eurozone countries to meet convergence standards ...
... raise significantly the cost of financing as could the failure of eurozone countries to meet convergence standards ...
Midterm Review - Faculty Directory | Berkeley-Haas
... FDI; flow (inflow and outflow), stock Form of FDI Greenfield, mergers and acquisitions Horizontal FDI Reasons for Horizontal FDI ...
... FDI; flow (inflow and outflow), stock Form of FDI Greenfield, mergers and acquisitions Horizontal FDI Reasons for Horizontal FDI ...
creation of money
... b) creating new money to pay for expenses c) asking the central bank to create new money in order to buy govt bonds („monetizing debt” or „monetary financing”) Options b) and c) result in an expansion of monetary base („printing money”). If such situation persists, according to the quantity theory o ...
... b) creating new money to pay for expenses c) asking the central bank to create new money in order to buy govt bonds („monetizing debt” or „monetary financing”) Options b) and c) result in an expansion of monetary base („printing money”). If such situation persists, according to the quantity theory o ...
Is Euroland the Next Argentina? - Center for Full Employment and
... This austerity lent a slow-growth bias to the economy that could only be overcome by high nongovernmental spending—either domestic consumption and investment or a trade surplus. Dollarization made Argentinean exports less competitive whenever its competitors devalued, and as the dollar rose generall ...
... This austerity lent a slow-growth bias to the economy that could only be overcome by high nongovernmental spending—either domestic consumption and investment or a trade surplus. Dollarization made Argentinean exports less competitive whenever its competitors devalued, and as the dollar rose generall ...
Gestiunea activităţii unei firme de intermediere
... Due to the weak institutional framework, the inefficient domestic firms are not forced to leave the market and they burden the cost of the efficient ones. Keeping the trained employees in the old sector may artificially delay the restructuring process. Deindustrialization and real appreciation are s ...
... Due to the weak institutional framework, the inefficient domestic firms are not forced to leave the market and they burden the cost of the efficient ones. Keeping the trained employees in the old sector may artificially delay the restructuring process. Deindustrialization and real appreciation are s ...
creation of money
... b) creating new money to pay for expenses c) asking the central bank to create new money in order to buy govt bonds („monetizing debt” or „monetary financing”) Options b) and c) result in an expansion of monetary base („printing money”). If such situation persists, according to the quantity theory o ...
... b) creating new money to pay for expenses c) asking the central bank to create new money in order to buy govt bonds („monetizing debt” or „monetary financing”) Options b) and c) result in an expansion of monetary base („printing money”). If such situation persists, according to the quantity theory o ...
Currency Analysis with Fundamentals
... The J-Curve Recall that currency demand/supply is based on foreign exchange expenditures If elasticities are low, then rising prices can actually increase expenditures Elasticities tend to increase over longer time horizons Necessities (in particular, energy) have lower elasticities than luxu ...
... The J-Curve Recall that currency demand/supply is based on foreign exchange expenditures If elasticities are low, then rising prices can actually increase expenditures Elasticities tend to increase over longer time horizons Necessities (in particular, energy) have lower elasticities than luxu ...
International Finance I
... The ideal currency 1) Must have fixed value with respect to major currencies 2) Must be convertible, so that there are no restrictions on the flow of capital from one country to another 3) Must support independent monetary policy which will ensure that a country can pursue the the best economic poli ...
... The ideal currency 1) Must have fixed value with respect to major currencies 2) Must be convertible, so that there are no restrictions on the flow of capital from one country to another 3) Must support independent monetary policy which will ensure that a country can pursue the the best economic poli ...
Macroeconomic Stabilization and Fiscal Reforms
... Taking into consideration need to maintain macro stability and ensure adequate credit to private sector Theory that heavy borrowing by a government soaks up the available credit, leaving little for the private sector at affordable interest rates. ...
... Taking into consideration need to maintain macro stability and ensure adequate credit to private sector Theory that heavy borrowing by a government soaks up the available credit, leaving little for the private sector at affordable interest rates. ...
relevant macroeconomic parameters
... resulting in the diminishing purchasing power of a given nominal sum of ...
... resulting in the diminishing purchasing power of a given nominal sum of ...
Sterling – US Dollar - Smart Currency Exchange
... US – Shadow on the horizon It’s been a positive quarter on the whole for the US economy, thanks to encouraging employment and job openings data. Events elsewhere in the world – most notably in Greece – drove up demand for the relative safe-haven US dollar. The International Monetary Fund (IMF) has c ...
... US – Shadow on the horizon It’s been a positive quarter on the whole for the US economy, thanks to encouraging employment and job openings data. Events elsewhere in the world – most notably in Greece – drove up demand for the relative safe-haven US dollar. The International Monetary Fund (IMF) has c ...
Report on China's Foreign Exchange Reserves
... dollars (of which commercial banking loans amounted to about 100 billion dollars); as the interest rate of loan from foreign commercial banking is usually 2 to 3 percent higher than that of deposits, to calculate with 2 percent, there would be 2 billion dollars more in the form of interest payment. ...
... dollars (of which commercial banking loans amounted to about 100 billion dollars); as the interest rate of loan from foreign commercial banking is usually 2 to 3 percent higher than that of deposits, to calculate with 2 percent, there would be 2 billion dollars more in the form of interest payment. ...
Foreign-exchange reserves
Foreign-exchange reserves (also called forex reserves or FX reserves) are assets held by a central bank or other monetary authority, usually in various reserve currencies, mostly the United States dollar, and to a lesser extent the euro, the pound sterling, and the Japanese yen, and used to back its liabilities—e.g., the local currency issued, and the various bank reserves deposited with the central bank by the government or by financial institutions.