An overview of the South African macro
... Economic growth takes place when the total production of goods and services in an economy increases. It is traditionally defined as the annual rate of increase in total production or income in the economy. This definition has to be qualified in two important respects. Firstly, production, or income, ...
... Economic growth takes place when the total production of goods and services in an economy increases. It is traditionally defined as the annual rate of increase in total production or income in the economy. This definition has to be qualified in two important respects. Firstly, production, or income, ...
Section 3 Notes
... The Time Lags of Fiscal Policy With any discretionary spending or taxing action taken by government, there are three points at which time lags can affect the implementation and success of the action. Recognition Time Lag - The time it takes policy makers to collect and review data and recognize ther ...
... The Time Lags of Fiscal Policy With any discretionary spending or taxing action taken by government, there are three points at which time lags can affect the implementation and success of the action. Recognition Time Lag - The time it takes policy makers to collect and review data and recognize ther ...
Chap002
... acquire resources and produce services is counted in GDP. • The federal government spends nearly $4 trillion per year. • In 2009, federal purchases of goods and services accounted for 7% of total output. • Income transfers are not counted in GDP. ...
... acquire resources and produce services is counted in GDP. • The federal government spends nearly $4 trillion per year. • In 2009, federal purchases of goods and services accounted for 7% of total output. • Income transfers are not counted in GDP. ...
Are we all Keynesians?
... The financial crisis has brought about a second Keynesian pragmatic revolution • In 2009, there was a “Keynes moment” when nearly all governments implemented fiscal stimulus packages. • These were based on Keynesian demand-side ideas regarding the merits of running budget deficits in times of reces ...
... The financial crisis has brought about a second Keynesian pragmatic revolution • In 2009, there was a “Keynes moment” when nearly all governments implemented fiscal stimulus packages. • These were based on Keynesian demand-side ideas regarding the merits of running budget deficits in times of reces ...
PRESIDENT'S REPORT TO THE BOARD OF DIRECTORS,
... During the first quarter, real GDP posted a gain led by growth in consumption, equipment and software, government spending, exports, and inventory investment. Imports, which are subtracted from GDP, also increased. Non-farm payroll employment increased significantly in April, and the unemployment ra ...
... During the first quarter, real GDP posted a gain led by growth in consumption, equipment and software, government spending, exports, and inventory investment. Imports, which are subtracted from GDP, also increased. Non-farm payroll employment increased significantly in April, and the unemployment ra ...
Fiscal-monetary interaction and ambiguity in the wake of the crisis Princeton University
... The monetary policy in these conditions is a threat to drive interest rates arbitrarily high as inflation rises. This can fail to violate any feasibility constraint or transversality condition. To rule out such “flight from money” equilibria, one can invoke the notion that at some price level the fi ...
... The monetary policy in these conditions is a threat to drive interest rates arbitrarily high as inflation rises. This can fail to violate any feasibility constraint or transversality condition. To rule out such “flight from money” equilibria, one can invoke the notion that at some price level the fi ...
Sample 2nd MT - Compiler Press
... A) Investors, anticipating an erosion of financial wealth due to inflation, decide to save more. As a result, aggregate demand decreases. B) The Bank of Canada raises interest rates so people plan to buy less consumer durables. As a result, the aggregate demand curve shifts leftward. C) The governm ...
... A) Investors, anticipating an erosion of financial wealth due to inflation, decide to save more. As a result, aggregate demand decreases. B) The Bank of Canada raises interest rates so people plan to buy less consumer durables. As a result, the aggregate demand curve shifts leftward. C) The governm ...
Problem Set 2 – Some Answers FE405 1.
... ANSWER: The following arguments highlight reasons why a high level of public debt can impose costs on the economy. Higher public debt implies a higher interest rate, which dampens investment with the result that the capital stock is lower. (This argument assumes that there is not full Ricardian equi ...
... ANSWER: The following arguments highlight reasons why a high level of public debt can impose costs on the economy. Higher public debt implies a higher interest rate, which dampens investment with the result that the capital stock is lower. (This argument assumes that there is not full Ricardian equi ...
Department of Economics, University of Toronto
... 5. Assume a constant level of output (i.e. y=0). Suppose that in the New Classical economy the growth rate of money decreases unexpectedly and that expectations are given by: expected inflation = last-period growth of money supply m(-1) i.e. expectations are based on last period's money growth. a. A ...
... 5. Assume a constant level of output (i.e. y=0). Suppose that in the New Classical economy the growth rate of money decreases unexpectedly and that expectations are given by: expected inflation = last-period growth of money supply m(-1) i.e. expectations are based on last period's money growth. a. A ...
Additional Reading 11
... refers to capital tax rather than the income tax the government used in its fiscal policy. So fiscal policy only shifts the AD curve!. The cut in capital tax is one of the stimulus supply side policies that shifts the SRAS curve to the right. Like we did for Simple Keynesian Curve, we also distingui ...
... refers to capital tax rather than the income tax the government used in its fiscal policy. So fiscal policy only shifts the AD curve!. The cut in capital tax is one of the stimulus supply side policies that shifts the SRAS curve to the right. Like we did for Simple Keynesian Curve, we also distingui ...
Government Debt - Illinois State University
... • LR balanced budget – stable debt/GDP ratio (30-50%) – SR implications - difficult – affect G & T changes on growth ...
... • LR balanced budget – stable debt/GDP ratio (30-50%) – SR implications - difficult – affect G & T changes on growth ...
5.4 Is Growth Good5.17 MB
... with their income in a year GDP per capita – the value of output produced by a country in a year divided by the population of that country. Technical economies of scale – reductions in average costs of production due to the use of more advanced machinery Quality of life – an individual’s overall sen ...
... with their income in a year GDP per capita – the value of output produced by a country in a year divided by the population of that country. Technical economies of scale – reductions in average costs of production due to the use of more advanced machinery Quality of life – an individual’s overall sen ...
Chapter 26 DEMAND-SIDE EQUILIBRIUM: UNEMPLOYMENT OR
... ● Any output below $6,000B → total expenditures > GDP → ↓inventories → ↑production ● Any output above $6,000B → total expenditures < GDP → ↑inventories → ↓production ● Equilibrium only occurs when Y = C + I + G + X-IM or GDP = total expenditure, which happens at $6,000B. ...
... ● Any output below $6,000B → total expenditures > GDP → ↓inventories → ↑production ● Any output above $6,000B → total expenditures < GDP → ↑inventories → ↓production ● Equilibrium only occurs when Y = C + I + G + X-IM or GDP = total expenditure, which happens at $6,000B. ...
Practice Prob/Essay for Second Midterm (actual MT given in past)
... 3. We now allow the small economy's interest rate to diverge temporarily from the world economy's interest rate, but in the long run, the domestic interest rate (r) will return to equal the world's interest rate (rf ). In this problem we'll investigate what happens when fiscal policy is used to att ...
... 3. We now allow the small economy's interest rate to diverge temporarily from the world economy's interest rate, but in the long run, the domestic interest rate (r) will return to equal the world's interest rate (rf ). In this problem we'll investigate what happens when fiscal policy is used to att ...
Demographic Change and Fiscal Sustainability in Asia
... Estrada, Lee, and Park 2015). This has significant implications for tax burden by age, since the age profiles are quite different depending on the incidence of tax on income versus consumption. Second, there is also a large variation across countries in terms of the expenditure mix. For example, abo ...
... Estrada, Lee, and Park 2015). This has significant implications for tax burden by age, since the age profiles are quite different depending on the incidence of tax on income versus consumption. Second, there is also a large variation across countries in terms of the expenditure mix. For example, abo ...
Presentation
... • Contracting out (CO): NGO can hire and fire, transfer staff, set wages, procure drugs, etc. • Contracting in (CI): NGO manages district, cannot hire and fire (but can transfer staff), $0.25 per capita budget supplement • Control/Comparison (CC): Services run by government 12 districts randomly ass ...
... • Contracting out (CO): NGO can hire and fire, transfer staff, set wages, procure drugs, etc. • Contracting in (CI): NGO manages district, cannot hire and fire (but can transfer staff), $0.25 per capita budget supplement • Control/Comparison (CC): Services run by government 12 districts randomly ass ...
Determination of Income and Employment Key concepts Aggregate
... In the short period price is fixed (constant) and elasticity of supply is infinite i.e., supply curve is perfectly elastic. It means the suppliers are willing to supply whatever amount of goods, consumer will demand at that price. 2) Fixed Interest Rate : Interest rate remains constant. 3) Aggregat ...
... In the short period price is fixed (constant) and elasticity of supply is infinite i.e., supply curve is perfectly elastic. It means the suppliers are willing to supply whatever amount of goods, consumer will demand at that price. 2) Fixed Interest Rate : Interest rate remains constant. 3) Aggregat ...
RATIONAL OPTIMIZING, MONETARY COMMUNICATION S William Walter Brown and GaryJ. Santoni
... monetary growth. This is so, however, only because the “productivity” of search and the “income” from leisure—factors that contribute to real income—are not included in measured income. Simply stated, measured output is not sufficiently broad to capture all the relevant ...
... monetary growth. This is so, however, only because the “productivity” of search and the “income” from leisure—factors that contribute to real income—are not included in measured income. Simply stated, measured output is not sufficiently broad to capture all the relevant ...
E P CONOMIC ERSPECTIVE
... included GSP estimates adjusted for inflation from 1999 through 2002. These data show that real California economic growth was nearly twice as fast as real national growth during the two-year period prior to the 2001 recession. However, with the technology downturn of the recession affecting Californ ...
... included GSP estimates adjusted for inflation from 1999 through 2002. These data show that real California economic growth was nearly twice as fast as real national growth during the two-year period prior to the 2001 recession. However, with the technology downturn of the recession affecting Californ ...
Fiscal Stimulus in a Monetary Union: Evidence from U.S. Regions
... sum taxes.3 In New Keynesian models, the size of the multiplier depends critically on the extent to which monetary policy “leans against the wind.” Strongly counter-cyclical monetary policy—such as that commonly estimated for the Volcker-Greenspan period—can generate quite low multipliers— comparab ...
... sum taxes.3 In New Keynesian models, the size of the multiplier depends critically on the extent to which monetary policy “leans against the wind.” Strongly counter-cyclical monetary policy—such as that commonly estimated for the Volcker-Greenspan period—can generate quite low multipliers— comparab ...
GDP - 4J Blog Server
... there is a decrease in the price of oil, then the AS curve will shift out to the right as we can produce more output with the same expenditure as before the price change. Conversely, a rise in wages will push the curve up and to the left. ...
... there is a decrease in the price of oil, then the AS curve will shift out to the right as we can produce more output with the same expenditure as before the price change. Conversely, a rise in wages will push the curve up and to the left. ...
Lecture Outline
... Therefore, when the government increases its purchases by $X $X, the aggregate demand for goods and services could rise by more or less than $X $X, depending on whether the multiplier effect or the crowdingcrowding-out effect is larger. If the multiplier effect is greater than the crowding-out e ...
... Therefore, when the government increases its purchases by $X $X, the aggregate demand for goods and services could rise by more or less than $X $X, depending on whether the multiplier effect or the crowdingcrowding-out effect is larger. If the multiplier effect is greater than the crowding-out e ...
AP Macroeconomics Unit 5 Portfolio Questions and Answers
... quantity of output demanded (measured as real GDP) and the price level (measured as the implicit price deflator). At each price level, the total quantity of goods and services demanded is the sum of the components of real GDP, as shown in the table. There is a negative relationship between the price ...
... quantity of output demanded (measured as real GDP) and the price level (measured as the implicit price deflator). At each price level, the total quantity of goods and services demanded is the sum of the components of real GDP, as shown in the table. There is a negative relationship between the price ...