Chap016
... monetary policy might also help if it gives investment spending a further boost. • The resulting stimulus will set off a multiplier reaction: – Multiplier–multiple by which an initial change in aggregate spending will alter total expenditure after an infinite number of spending cycles. ...
... monetary policy might also help if it gives investment spending a further boost. • The resulting stimulus will set off a multiplier reaction: – Multiplier–multiple by which an initial change in aggregate spending will alter total expenditure after an infinite number of spending cycles. ...
Economics 9/24/14 http://mrmilewski.com /a/csdm.k12.mi.us
... Demand Shocks and Sticky Prices • If prices are sticky, or inflexible, demand shocks will result in short-term changes in production and employment. • If demand drops below the optimum level, production would have to drop to match demand. If it rises above optimal level, production would have to in ...
... Demand Shocks and Sticky Prices • If prices are sticky, or inflexible, demand shocks will result in short-term changes in production and employment. • If demand drops below the optimum level, production would have to drop to match demand. If it rises above optimal level, production would have to in ...
To view this press release as a file
... is a result of two offsetting forces: the deficit in the current account and the decline in the interest rate gaps relative to abroad (following the reduction in the interest rate for February), which provided support for a depreciation; and the favorable situation of the Israeli economy relative to ...
... is a result of two offsetting forces: the deficit in the current account and the decline in the interest rate gaps relative to abroad (following the reduction in the interest rate for February), which provided support for a depreciation; and the favorable situation of the Israeli economy relative to ...
Intermediate Macroeconomics: Great Recession
... can end up with “negative equity,” which means that the outstanding mortgage balance exceeds the market value of the home. In this situation, a homeowner may have an incentive to “walk away” – to quit paying the mortgage altogether. Negative equity is more likely if the homeowner put little “down” o ...
... can end up with “negative equity,” which means that the outstanding mortgage balance exceeds the market value of the home. In this situation, a homeowner may have an incentive to “walk away” – to quit paying the mortgage altogether. Negative equity is more likely if the homeowner put little “down” o ...
The Resurgence of the US Dollar as a Safe Haven
... The US economy runs a fiscal and current account deficit. US is the largest debtor nation in the world and over 30% of its debt is held by foreigners. The US Federal Reserve (Fed) has increased its balance sheet size by four times since 2007 as it pumped in unprecedented amounts of money into the ec ...
... The US economy runs a fiscal and current account deficit. US is the largest debtor nation in the world and over 30% of its debt is held by foreigners. The US Federal Reserve (Fed) has increased its balance sheet size by four times since 2007 as it pumped in unprecedented amounts of money into the ec ...
Monetary Policy, Incomplete Information, and the Zero Lower Bound
... Two Approaches for Determining the Appropriate Stance of Monetary Policy ● Forecast Targeting: A specific macroeconomic model (usually with judgmental adjustments) is used to determine the policy path that is expected to generate the most appropriate outcomes for real economic activity and inflatio ...
... Two Approaches for Determining the Appropriate Stance of Monetary Policy ● Forecast Targeting: A specific macroeconomic model (usually with judgmental adjustments) is used to determine the policy path that is expected to generate the most appropriate outcomes for real economic activity and inflatio ...
Fixed Income Markets In Flux What it Means for Banks
... economy, the threat of increasing inflation, the movement of key interest rates, and the company’s ability to effectively respond to these changes. To the extent that potential impacts on company results are discussed, actual results may differ materially. ...
... economy, the threat of increasing inflation, the movement of key interest rates, and the company’s ability to effectively respond to these changes. To the extent that potential impacts on company results are discussed, actual results may differ materially. ...
What We Hope To Accomplish
... Consumers (refer to expenditure of consumers as “consumption”) Businesses (refer to expenditure of firms as “investment”) Governments (refer to expenditures of governments as “government spending”) Foreign Sector (refer to expenditures of foreign sector as “exports”) ...
... Consumers (refer to expenditure of consumers as “consumption”) Businesses (refer to expenditure of firms as “investment”) Governments (refer to expenditures of governments as “government spending”) Foreign Sector (refer to expenditures of foreign sector as “exports”) ...
Miami Dade College ECO 2013.003 Principles of Macroeconomics
... 2. An economy has historically grown at a rate of 2.25%. Currently, this economy is growing at a rate of 3%, and the unemployment rate is low by historical standards. The economy is expected to continue to grow in the near future, and the monetary authorities are concerned that inflation may increas ...
... 2. An economy has historically grown at a rate of 2.25%. Currently, this economy is growing at a rate of 3%, and the unemployment rate is low by historical standards. The economy is expected to continue to grow in the near future, and the monetary authorities are concerned that inflation may increas ...
The FRB St Louis New Economic Narrative and Negative Rates
... One hypothesis is that there is a large liquidity premium on safe liquid government debt that has made r† is abnormally low -- in fact it’s negative! We argue that there has been a large increase in the demand for government debt because of (1) global savings glut, (2) demographics, (3) regulatory c ...
... One hypothesis is that there is a large liquidity premium on safe liquid government debt that has made r† is abnormally low -- in fact it’s negative! We argue that there has been a large increase in the demand for government debt because of (1) global savings glut, (2) demographics, (3) regulatory c ...
File
... The Federal Reserve System Answer questions for this video: • https://www.youtube.com/watch?v=1dq7mMort9o 1. What are the two most important jobs of the central bank? 2. What happens when interest rates are low? 3. What happens when interest rates are high? 4. What happens if the Fed increases the ...
... The Federal Reserve System Answer questions for this video: • https://www.youtube.com/watch?v=1dq7mMort9o 1. What are the two most important jobs of the central bank? 2. What happens when interest rates are low? 3. What happens when interest rates are high? 4. What happens if the Fed increases the ...
Fall 2007
... 15) Fiscal policy is made by _____; monetary policy is made by _____. a) the Federal Reserve System; the executive and legislative branches b) the executive and legislative branches; the Federal Reserve System c) the Federal Reserve System; the Treasury Department d) the Treasury Department; the Fed ...
... 15) Fiscal policy is made by _____; monetary policy is made by _____. a) the Federal Reserve System; the executive and legislative branches b) the executive and legislative branches; the Federal Reserve System c) the Federal Reserve System; the Treasury Department d) the Treasury Department; the Fed ...
A Closer Look at US Economic Weakness
... trough of the 2001 recession. At its nadir, business fixed investment spending was 14.2 percent below its prerecession peak. Eight quarters after the trough, business fixed investment spending was 7.4 percent below its prerecession peak. Business fixed investment spending did ...
... trough of the 2001 recession. At its nadir, business fixed investment spending was 14.2 percent below its prerecession peak. Eight quarters after the trough, business fixed investment spending was 7.4 percent below its prerecession peak. Business fixed investment spending did ...
fiscal & monetary policy
... • Keynes argued that fiscal policy can be used to fight periods of recession: • If consumer spending drops, government should respond by dropping its own spending until consumer spending goes back up. • OR it can cut taxes so that spending and investment by consumers and businesses increases. ...
... • Keynes argued that fiscal policy can be used to fight periods of recession: • If consumer spending drops, government should respond by dropping its own spending until consumer spending goes back up. • OR it can cut taxes so that spending and investment by consumers and businesses increases. ...
State Government Revenue Recovery from the Great Recession
... significant at better than the 10 percent level. (Note again that we have excluded North Dakota.) State Economic Growth. The most obvious reason for revenues not recovering is that the state’s economy has not recovered. We calculate the ratio of 2012 state real per capita gross state product to that ...
... significant at better than the 10 percent level. (Note again that we have excluded North Dakota.) State Economic Growth. The most obvious reason for revenues not recovering is that the state’s economy has not recovered. We calculate the ratio of 2012 state real per capita gross state product to that ...
Econ 300 Homework 1 Due on Tuesday, July 22, 2014 at 12.00 in
... Homework 1 Due on Tuesday, July 22, 2014 at 12.00 in class. Short Questions (5 points for each question from 1 to 6) 1) What are the three appraches to measuring GDP? 2) What is the difference between GDP and GNP? 3) Is GDP a good measure of economic welfare? Why or why not? 4) What is investment? 5 ...
... Homework 1 Due on Tuesday, July 22, 2014 at 12.00 in class. Short Questions (5 points for each question from 1 to 6) 1) What are the three appraches to measuring GDP? 2) What is the difference between GDP and GNP? 3) Is GDP a good measure of economic welfare? Why or why not? 4) What is investment? 5 ...
Demand for Loans Real Interest Rate
... Current = net exports + net foreign investment/factor income Capital = net investments balance of payments = current + capital balance of payments must equal 0!!! ...
... Current = net exports + net foreign investment/factor income Capital = net investments balance of payments = current + capital balance of payments must equal 0!!! ...
Business Cycles
... Introduction to Business Cycles (continued) • Classical economists view business cycles as representing the economy’s best response to disturbances in production and spending. • The modern version is called the Real Business Cycle theory (RBC). • Keynesian economists argue that because wages and pr ...
... Introduction to Business Cycles (continued) • Classical economists view business cycles as representing the economy’s best response to disturbances in production and spending. • The modern version is called the Real Business Cycle theory (RBC). • Keynesian economists argue that because wages and pr ...
Economics, by R. Glenn Hubbard and Anthony Patrick O`Brien
... In a market economy individuals engage in trade – they provide goods and services to others and receive goods and services in return. There are gains from trade – people can get more of what they want through trade than they could if they tried to be self-sufficient. This increase in output is due t ...
... In a market economy individuals engage in trade – they provide goods and services to others and receive goods and services in return. There are gains from trade – people can get more of what they want through trade than they could if they tried to be self-sufficient. This increase in output is due t ...
Monetary Policy and the Econnomy
... Monetary policy can be a powerful tool to fight recessions: - Recession is caused by lack of demand - AD shifts left, Y and P. - MS r and ID shifts AD back right ...
... Monetary policy can be a powerful tool to fight recessions: - Recession is caused by lack of demand - AD shifts left, Y and P. - MS r and ID shifts AD back right ...
The Macro Goal Variables
... Primarily affected by: -- labor productivity -- the capital stock -- the labor force ...
... Primarily affected by: -- labor productivity -- the capital stock -- the labor force ...
Economic Activites
... businesses lower production, unemployment begins to rise, and GDP growth slows for two or more quarters of the calendar year May not be too serious or last long May signal trouble for some workers in related businesses The ripple effect is a drop in related businesses Some last for long peri ...
... businesses lower production, unemployment begins to rise, and GDP growth slows for two or more quarters of the calendar year May not be too serious or last long May signal trouble for some workers in related businesses The ripple effect is a drop in related businesses Some last for long peri ...