Money
... – Used when economy is overheated (rapidly increasing GDP and inflation) – Decrease investment and slow economic expansion – Possible side-effect: Can cause increase in unemployment ...
... – Used when economy is overheated (rapidly increasing GDP and inflation) – Decrease investment and slow economic expansion – Possible side-effect: Can cause increase in unemployment ...
Word Document
... FDR created programs designed to keep prices and wages high. In 1942 FDR set income tax rates above $25,000 at 100% by executive order. In the 1920’s Ms expanded by 40%, but the price level was stable because Md also increased. Milton Friedman pointed out that when you see unemployment high ...
... FDR created programs designed to keep prices and wages high. In 1942 FDR set income tax rates above $25,000 at 100% by executive order. In the 1920’s Ms expanded by 40%, but the price level was stable because Md also increased. Milton Friedman pointed out that when you see unemployment high ...
Ch21 - 山东大学课程中心
... 3. What happens to the position of the LM curve if the Fed decides that it will decrease the money supply to fight inflation and if, at the same time, the demand for money falls? 4. "An excess demand for money resulting from a rise in the demand for money can be eliminated only by a rise in the inte ...
... 3. What happens to the position of the LM curve if the Fed decides that it will decrease the money supply to fight inflation and if, at the same time, the demand for money falls? 4. "An excess demand for money resulting from a rise in the demand for money can be eliminated only by a rise in the inte ...
INETTurner - William White
... In contrast, Lord Turner’s proposal (as described more fully in his Cass lecture) has to do with crisis management, with “getting out of this mess”. Moreover, the solution that he wants us to consider (though not necessarily to accept) would be further increases in government deficits that would be ...
... In contrast, Lord Turner’s proposal (as described more fully in his Cass lecture) has to do with crisis management, with “getting out of this mess”. Moreover, the solution that he wants us to consider (though not necessarily to accept) would be further increases in government deficits that would be ...
Keynes Theory and Sample Questions
... holding money fell, so holding money became a more viable option. c. Loanable Funds Perspective – a more recent approach Why do people demand money? To purchase goods and services When do people demand goods and services? When the prices of these items fall. As interest rates fall, the price of big ...
... holding money fell, so holding money became a more viable option. c. Loanable Funds Perspective – a more recent approach Why do people demand money? To purchase goods and services When do people demand goods and services? When the prices of these items fall. As interest rates fall, the price of big ...
Weekly Market Commentary November 25, 2013
... abolished and replaced by an automated system that would increase money supply at a steady, pre-set rate. He believed such a system would better control inflation, making spending and investment decisions more certain. The Economist article said: "In theory, then, the system ought to keep a lid on i ...
... abolished and replaced by an automated system that would increase money supply at a steady, pre-set rate. He believed such a system would better control inflation, making spending and investment decisions more certain. The Economist article said: "In theory, then, the system ought to keep a lid on i ...
Module1.3
... it is M1 and M2 that more directly control the real sector. • But Fed doesn’t have full control over M1 and M2. • Note that most of the money supply aggregates that comprise M1 and M2 are determined by private decisions which the Fed can’t control. Thus Fed only has monetary base to influence M1 and ...
... it is M1 and M2 that more directly control the real sector. • But Fed doesn’t have full control over M1 and M2. • Note that most of the money supply aggregates that comprise M1 and M2 are determined by private decisions which the Fed can’t control. Thus Fed only has monetary base to influence M1 and ...
Lecture O: Overview
... transactions, and they might keep extra money for other reasons. Thus, there is a basic demand side for paper money. Money supply is defined by a number of different measures. Some people do not use all of their money for consumption and have some extra around. Some people want to spend more than th ...
... transactions, and they might keep extra money for other reasons. Thus, there is a basic demand side for paper money. Money supply is defined by a number of different measures. Some people do not use all of their money for consumption and have some extra around. Some people want to spend more than th ...
Ancients/Mercantilists/Physiocrats
... ...moneymaking from retail trade is unnatural, a mode by which men gain from one another. The most hated sort is usury, which makes a gain out of money itself and not from the natural use of it. For money was intended to be used in exchange, not to increase at interest. The term usury, which means t ...
... ...moneymaking from retail trade is unnatural, a mode by which men gain from one another. The most hated sort is usury, which makes a gain out of money itself and not from the natural use of it. For money was intended to be used in exchange, not to increase at interest. The term usury, which means t ...
Monetary Policy / The Fed / Banking
... recession possibly worse. In an inflationary period, they may increase spending or cut taxes as their budgets head for surplus. 3. The crowding-out effect may be caused by fiscal policy. a. “Crowding-out” may occur with government deficit spending. It may increase the interest rate and reduce privat ...
... recession possibly worse. In an inflationary period, they may increase spending or cut taxes as their budgets head for surplus. 3. The crowding-out effect may be caused by fiscal policy. a. “Crowding-out” may occur with government deficit spending. It may increase the interest rate and reduce privat ...
Macroeconomics: BSc Year One The Monetarist View of Interest
... interest rate. The long run effect is the opposite of the short run effect in terms of interest rates, but inflation still occurs. The government must then repeat the policy to lower interest rates by expanding money supply quicker than expected. The long-term effects can also be explained intuitive ...
... interest rate. The long run effect is the opposite of the short run effect in terms of interest rates, but inflation still occurs. The government must then repeat the policy to lower interest rates by expanding money supply quicker than expected. The long-term effects can also be explained intuitive ...
Different types of Money
... many chickens a pig is worth; they just sell a pig for X dollars and then buy a chicken for Y dollars. 2. Another advantage of money is that it keeps its value if you put it in storage ...
... many chickens a pig is worth; they just sell a pig for X dollars and then buy a chicken for Y dollars. 2. Another advantage of money is that it keeps its value if you put it in storage ...
8 Economic policy_20..
... ─ The demand for money is related with peoples intensions to hold (save) or spend the money. ─ There are three reasons why people wish to ...
... ─ The demand for money is related with peoples intensions to hold (save) or spend the money. ─ There are three reasons why people wish to ...
The Monetary System: What It Is and How It Works
... • Businesses were losing money and defaulting on their loans • This caused lots of bank failures • Ordinary depositors lost faith in banks and chose to keep their savings in cash • As a result, the cash-deposit ratio increased • This reduced the money multiplier • So, M rose slower than B ...
... • Businesses were losing money and defaulting on their loans • This caused lots of bank failures • Ordinary depositors lost faith in banks and chose to keep their savings in cash • As a result, the cash-deposit ratio increased • This reduced the money multiplier • So, M rose slower than B ...
Money - sambaker.com
... • The Fed cut interest rates • But prices were falling and goods were unsold, because people weren’t spending • Interest rates went to near 0%, but private spending didn’t respond – Real interest rate = Interest rate – Inflation rate – If inflation rate < 0, the real interest rate is high, even if t ...
... • The Fed cut interest rates • But prices were falling and goods were unsold, because people weren’t spending • Interest rates went to near 0%, but private spending didn’t respond – Real interest rate = Interest rate – Inflation rate – If inflation rate < 0, the real interest rate is high, even if t ...
Zarnowitz, Victor. Business Cycles Observed and Assessed
... stimulates the business activity in the economy. This activity can cause extreme recklessness, which can prompt it to produce feverish speculation, potentially leading to a crash in credit and widespread bankruptcy. One of the first economists to argue the importance of inflation was David Ricardo. ...
... stimulates the business activity in the economy. This activity can cause extreme recklessness, which can prompt it to produce feverish speculation, potentially leading to a crash in credit and widespread bankruptcy. One of the first economists to argue the importance of inflation was David Ricardo. ...
By dint of railing at fools, we risk becoming fools
... completeness can be guaranteed. Any judgments articulated are Roger Nightingale’s as at the date appearing on the material. They are subject to change without notice and might not be followed with a specific ad-hoc document. This material should not be construed as an offer to sell or the solicitati ...
... completeness can be guaranteed. Any judgments articulated are Roger Nightingale’s as at the date appearing on the material. They are subject to change without notice and might not be followed with a specific ad-hoc document. This material should not be construed as an offer to sell or the solicitati ...
Macro Lessons of the 1930s Economist
... might buy bonds on a larger scale. What scale he has in mind, though, is unclear. Jens Weidmann, president of Germany’s Bundesbank and an influential member of the ECB’s governing council, has clearly stated that the ECB “must not be” the euro zone’s lender of last resort. Where this path leads On t ...
... might buy bonds on a larger scale. What scale he has in mind, though, is unclear. Jens Weidmann, president of Germany’s Bundesbank and an influential member of the ECB’s governing council, has clearly stated that the ECB “must not be” the euro zone’s lender of last resort. Where this path leads On t ...
The Keynesian/Monetarist Debates
... Examples – monetary expansion – should lower interest rates and stimulate investment Rational expectations suggest people anticipate the inflationary effects of money supply increases and actually raise interest rates to avoid negative rates of return. Easy to see following the S&L crisis in the lat ...
... Examples – monetary expansion – should lower interest rates and stimulate investment Rational expectations suggest people anticipate the inflationary effects of money supply increases and actually raise interest rates to avoid negative rates of return. Easy to see following the S&L crisis in the lat ...
Chapter 3: America on the Eve of Revolution
... positive or negative economic growth in per capita real GDP under English rule? Did colonists experience inflation or deflation in the years leading up to the American ...
... positive or negative economic growth in per capita real GDP under English rule? Did colonists experience inflation or deflation in the years leading up to the American ...