Lecture XIII
... increase – Actual wage increase: original increase due to lower unemployment + additional increase due to expected inflation πe – Horizontal shift of P.C. to the right – Higher real wage → fall of labor demand → lower output → return to normal levels of output and unemployment and to the situation w ...
... increase – Actual wage increase: original increase due to lower unemployment + additional increase due to expected inflation πe – Horizontal shift of P.C. to the right – Higher real wage → fall of labor demand → lower output → return to normal levels of output and unemployment and to the situation w ...
What Have We Learned since October 1979?
... During these three periods of FOMC “inaction,” intermediate and long rates were not marking time. Similarly, during the most recent Federal Reserve tightening (June 1999May 2000) and easing (January 2001-June 2004) cycles, bond rates have moved around quite a bit—generally in the direction the Fed w ...
... During these three periods of FOMC “inaction,” intermediate and long rates were not marking time. Similarly, during the most recent Federal Reserve tightening (June 1999May 2000) and easing (January 2001-June 2004) cycles, bond rates have moved around quite a bit—generally in the direction the Fed w ...
midterm prep
... Is that large or small compared to other countries? What is the U.S. net foreign indebtedness as percent of GDP? What are the risks associated with running a large current account deficit? Explain the three ways in which one can view a CA deficit. How does a fiscal deficit contribute to the CA defic ...
... Is that large or small compared to other countries? What is the U.S. net foreign indebtedness as percent of GDP? What are the risks associated with running a large current account deficit? Explain the three ways in which one can view a CA deficit. How does a fiscal deficit contribute to the CA defic ...
EC 132.01 Discussion Session
... increasing; commonly referred to as a boom. (P.349) Definition: (contraction phase) The period of time during which economic activity is declining; commonly referred to as a recession. (P.349) Definition: (Multiplier-accelerator model) An internal model of the business cycle that is based on the ins ...
... increasing; commonly referred to as a boom. (P.349) Definition: (contraction phase) The period of time during which economic activity is declining; commonly referred to as a recession. (P.349) Definition: (Multiplier-accelerator model) An internal model of the business cycle that is based on the ins ...
Monetary Policy and Open
... The federal funds rate is the short-term interest rate banks charge other banks on overnight loans; this rate can be adjusted up or down by actions taken by the Federal Reserve (the "Fed") to grow or slow down the economy and inflation. To increase the money supply and grow the economy, the governme ...
... The federal funds rate is the short-term interest rate banks charge other banks on overnight loans; this rate can be adjusted up or down by actions taken by the Federal Reserve (the "Fed") to grow or slow down the economy and inflation. To increase the money supply and grow the economy, the governme ...
Document
... Short-Run Aggregate Supply Curve Shows the direct relationship between the overall price level and the level of real output that will be supplied in response to changes in demand before full adjustment of relative price has taken place ...
... Short-Run Aggregate Supply Curve Shows the direct relationship between the overall price level and the level of real output that will be supplied in response to changes in demand before full adjustment of relative price has taken place ...
Glossary
... tax on capital gains from stocks is now 20%. For most people now, there is no capital gains tax from the sale of a home one lived in. Capital Goods. Goods that will increase the ability of the business to produce --- goods such as machines, tools, equipment, factory buildings, office buildings, and ...
... tax on capital gains from stocks is now 20%. For most people now, there is no capital gains tax from the sale of a home one lived in. Capital Goods. Goods that will increase the ability of the business to produce --- goods such as machines, tools, equipment, factory buildings, office buildings, and ...
EconomicPolicy AP2013
... Result: Banks have MORE money to lend, and consumers have MORE money to spend! ...
... Result: Banks have MORE money to lend, and consumers have MORE money to spend! ...
The Quantity Theory of Money in a Developing Economy: Empirical
... well. Implying, an increase in interest rate vis-à-vis money demand, plus a direct relation between anticipated inflation and money demand. In contrast, all coefficients are statistically significant, except for the real interest rate. This could be explained by the dominance of the open market oper ...
... well. Implying, an increase in interest rate vis-à-vis money demand, plus a direct relation between anticipated inflation and money demand. In contrast, all coefficients are statistically significant, except for the real interest rate. This could be explained by the dominance of the open market oper ...
Practice Test # 3
... b. the required reserve ratio, raising the discount rate, and selling government bonds on the open market. c. the required reserve ratio, raising the discount rate, and buying government bonds on the open market. d. the discount rate, cutting the discount rate, and raising the margin requirement. e. ...
... b. the required reserve ratio, raising the discount rate, and selling government bonds on the open market. c. the required reserve ratio, raising the discount rate, and buying government bonds on the open market. d. the discount rate, cutting the discount rate, and raising the margin requirement. e. ...
Monetary Policy PowerPoint
... • advises Congress and President on economic policy Supervising member banks “banking systems watchdog” • monitors loans and investments and reviews bank records of reserves • regulates bank mergers Regulating the Money Supply—amount of money circulating in the economy • Dollars—printed by Bureau of ...
... • advises Congress and President on economic policy Supervising member banks “banking systems watchdog” • monitors loans and investments and reviews bank records of reserves • regulates bank mergers Regulating the Money Supply—amount of money circulating in the economy • Dollars—printed by Bureau of ...
Money Creation and Deposit Insurance
... Banks and Money • As early as 1000 B.C., uncoined gold and silver were being used for money in Mesopotamia. • Later, goldsmiths started issuing paper notes indicating that the bearers held gold or silver of given weights and on deposit with the goldsmith. • These notes could be exchanged for goods ...
... Banks and Money • As early as 1000 B.C., uncoined gold and silver were being used for money in Mesopotamia. • Later, goldsmiths started issuing paper notes indicating that the bearers held gold or silver of given weights and on deposit with the goldsmith. • These notes could be exchanged for goods ...
Money in the Economy
... • Members of the non-bank public determine currency in circulation – Increases in currency drains from the banking system, diminish the expansion of deposits – Decreases in currency drains from the banking system, increase the expansion of deposits ...
... • Members of the non-bank public determine currency in circulation – Increases in currency drains from the banking system, diminish the expansion of deposits – Decreases in currency drains from the banking system, increase the expansion of deposits ...
Ch33 - OCCC.edu
... main one used by the FED). So monetary policy is when the FED engages in purchasing or selling bonds, controlling money supply, and therefore altering interest rates. This ends up having an increasing effect on spending in the economy and therefore increases overall GDP. So we go to the AE-Line next ...
... main one used by the FED). So monetary policy is when the FED engages in purchasing or selling bonds, controlling money supply, and therefore altering interest rates. This ends up having an increasing effect on spending in the economy and therefore increases overall GDP. So we go to the AE-Line next ...
Chapter 13
... supply, as _________________ would be available for borrowing. (And what is left for borrowing will command a ________________ interest rate). o Decreasing the reserve requirement would ______________ the money supply, as more __________ would be available for borrowing. (An because there is more mo ...
... supply, as _________________ would be available for borrowing. (And what is left for borrowing will command a ________________ interest rate). o Decreasing the reserve requirement would ______________ the money supply, as more __________ would be available for borrowing. (An because there is more mo ...
Understanding Modern Money - Levy Economics Institute of Bard
... recognizes that money today is not a commodity—it is usually called ‘fiat money’—although some orthodox economists would like to return to a ‘commodity money’ (notes and coins redeemable for gold), or at least want to operate a fiat money system as if it were a ‘commodity money’ system. Indeed, in h ...
... recognizes that money today is not a commodity—it is usually called ‘fiat money’—although some orthodox economists would like to return to a ‘commodity money’ (notes and coins redeemable for gold), or at least want to operate a fiat money system as if it were a ‘commodity money’ system. Indeed, in h ...
Topic 3: Fiscal Policy
... Made up of three pieces: Transaction Demand – money on hand for transactions (money needed for purchases) Precautionary Demand – rainy day funds (money that might be needed for purchases) Speculative Demand – e.g., hold cash to buy bonds later if you expect bond rate will rise soon (money you ...
... Made up of three pieces: Transaction Demand – money on hand for transactions (money needed for purchases) Precautionary Demand – rainy day funds (money that might be needed for purchases) Speculative Demand – e.g., hold cash to buy bonds later if you expect bond rate will rise soon (money you ...
Limits to Inflation Targeting
... bank and the treasury are consolidated, so that the public debt has vanished when only debt held by the central bank remains. But in the recent policy discussions it was assumed that the Fed might need to turn to holding private securities as backing for monetary reserves. That is, it was assumed th ...
... bank and the treasury are consolidated, so that the public debt has vanished when only debt held by the central bank remains. But in the recent policy discussions it was assumed that the Fed might need to turn to holding private securities as backing for monetary reserves. That is, it was assumed th ...
Chapter 22
... (Developed by the classical economists in the nineteenth century, based on the work of Fisher of 1911). The most important feature of this theory is that it suggests that interest rate have no effect on the demand for money. And in general, the classical point of view, individuals are assumed to hol ...
... (Developed by the classical economists in the nineteenth century, based on the work of Fisher of 1911). The most important feature of this theory is that it suggests that interest rate have no effect on the demand for money. And in general, the classical point of view, individuals are assumed to hol ...
QUESTION BANK MACROECONOMICS
... 1. Discuss the process of credit creation by the commercial banks. Explain in this context the statement that “an individual bank has little ability to expand the money supply unless all the other banks expand in step” 2. Explain the mechanism of the multiple expansions of bank assets and liabilitie ...
... 1. Discuss the process of credit creation by the commercial banks. Explain in this context the statement that “an individual bank has little ability to expand the money supply unless all the other banks expand in step” 2. Explain the mechanism of the multiple expansions of bank assets and liabilitie ...
Professor`s Name
... spending has actually increased from 341.32 to 348.4. The rise in business investment, encouraged by the lower cost of investing, has eliminated most of the drop in real GDP that would otherwise have been caused by the decline in Government demand for goods and services. This is “crowding in.” ...
... spending has actually increased from 341.32 to 348.4. The rise in business investment, encouraged by the lower cost of investing, has eliminated most of the drop in real GDP that would otherwise have been caused by the decline in Government demand for goods and services. This is “crowding in.” ...