The IS-MP-model and the difference between neoclassical and
... This fpf does not add anything if the r*, (w/P)* solution generated by the IS-MP-model happens to lie on the factor price frontier, as is the case in Graph 3. The central bank still chooses an MPcurve which intersects with IS at full employment and at the equilibrium real rate of interest, which cor ...
... This fpf does not add anything if the r*, (w/P)* solution generated by the IS-MP-model happens to lie on the factor price frontier, as is the case in Graph 3. The central bank still chooses an MPcurve which intersects with IS at full employment and at the equilibrium real rate of interest, which cor ...
Eco120Int_Lecture9
... interest rates • The nominal interest rate is the rate that you pay on a loan or that you get paid at a bank. • Problem: You don’t eat money. What you care about is the buying power of your savings. If prices double from one year to the next, if nominal interest rates are less than 100%, you can buy ...
... interest rates • The nominal interest rate is the rate that you pay on a loan or that you get paid at a bank. • Problem: You don’t eat money. What you care about is the buying power of your savings. If prices double from one year to the next, if nominal interest rates are less than 100%, you can buy ...
Money Demand and the Quantity Theory
... arbitrarily pick one the Federal Reserve’s official aggregates to derive the benchmark results and perhaps experiment with one or two alternatives to assess the robustness of the findings. Lucas and Nicolini’s model, by contrast, tells them quite specifically how to measure the variable M in the dat ...
... arbitrarily pick one the Federal Reserve’s official aggregates to derive the benchmark results and perhaps experiment with one or two alternatives to assess the robustness of the findings. Lucas and Nicolini’s model, by contrast, tells them quite specifically how to measure the variable M in the dat ...
Wages, employment and prices
... identical with NAIRU. In the Keynesian model, capital and goods markets can create unemployment rates which are much higher than the unemployment rate necessary to prevent a wage-price spiral. In Europe, for example, unemployment rates since the 1970s cannot be explained by excessive wage pressure. ...
... identical with NAIRU. In the Keynesian model, capital and goods markets can create unemployment rates which are much higher than the unemployment rate necessary to prevent a wage-price spiral. In Europe, for example, unemployment rates since the 1970s cannot be explained by excessive wage pressure. ...
Macro Quiz 5.tst
... A) the inflation rate was less than expected. B) there is an anticipated decrease in the real interest rate. C) the inflation rate was more than expected. D) None of the above answers is correct. ...
... A) the inflation rate was less than expected. B) there is an anticipated decrease in the real interest rate. C) the inflation rate was more than expected. D) None of the above answers is correct. ...
lecture notes
... since there is no substitute for “everything.” b. Income effect also doesn’t apply in the aggregate case, since income now varies with aggregate output. 3. What is the explanation of the inverse relationship between price level and real output in aggregate demand? a. Real balances effect: When price ...
... since there is no substitute for “everything.” b. Income effect also doesn’t apply in the aggregate case, since income now varies with aggregate output. 3. What is the explanation of the inverse relationship between price level and real output in aggregate demand? a. Real balances effect: When price ...
NBER WORKING PAPER SERIES DEFLATION AND MONETARY POLICY IN TAIWAN Ya-Hwei Yang
... Ya-Hwei Yang is Research Fellow and Director of the Center for Economic and Financial Strategies, ChungHua Institution for Economic Research. Jia-Dong Shea is Adjunct Professor of Economics, National Taiwan University. The authors thank Takatoshi Ito, Andrew Rose, Toshiki Jinushi, Shigeroni Shiratsu ...
... Ya-Hwei Yang is Research Fellow and Director of the Center for Economic and Financial Strategies, ChungHua Institution for Economic Research. Jia-Dong Shea is Adjunct Professor of Economics, National Taiwan University. The authors thank Takatoshi Ito, Andrew Rose, Toshiki Jinushi, Shigeroni Shiratsu ...
Presentación de Kozo Kunimune, en inglés (pdf, 138 Kb.)
... average spread the banks had been making on lending had been about 0.5 percentage points, … (2) the losses incurred from defaults on loans in the four years from 1996 to 1999 have been about 1.4 to 2.8% of total loans. Thus, the spread that the banks have ...
... average spread the banks had been making on lending had been about 0.5 percentage points, … (2) the losses incurred from defaults on loans in the four years from 1996 to 1999 have been about 1.4 to 2.8% of total loans. Thus, the spread that the banks have ...
Sample 2nd MT - Compiler Press
... 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 government reduces the goods and services tax. As a result, consumption expenditure increases and aggregate demand increases. D) The exchange ra ...
... 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 government reduces the goods and services tax. As a result, consumption expenditure increases and aggregate demand increases. D) The exchange ra ...
Macro Economic Analysis
... (a) fall in price level (b) increase value of money (c) decrease value of money (d) None 35. Who told Inflation is too much of money chasing too few goods: (a) Coulbourn (b) Keynes (c) Friedman (d) Samuelsson 36. Among the following which is not a feature of inflation? (a) long term process (b) stat ...
... (a) fall in price level (b) increase value of money (c) decrease value of money (d) None 35. Who told Inflation is too much of money chasing too few goods: (a) Coulbourn (b) Keynes (c) Friedman (d) Samuelsson 36. Among the following which is not a feature of inflation? (a) long term process (b) stat ...
Homework #5 - Answers Macro Policy Analysis Due Mar 25
... Before solving the model numerically (which you will do below), use your knowledge of the AD-AS model and the Phillips Curve to describe how you expect this economy to behave if, starting from a long-run equilibrium with constant prices, the monetary authorities now begin to increase the money suppl ...
... Before solving the model numerically (which you will do below), use your knowledge of the AD-AS model and the Phillips Curve to describe how you expect this economy to behave if, starting from a long-run equilibrium with constant prices, the monetary authorities now begin to increase the money suppl ...
Problem Set #3: Building and Applying the IS - LM
... – Therefore, the equilibrium real interest rate equals 5 percent. c. Assume that the price level is fixed. What happens to the equilibrium interest rate if the supply of money is raised from 1,000 to 1,200? – If the price level remains fixed at 2 and the supply of money is raised from 1,000 to 1,200 ...
... – Therefore, the equilibrium real interest rate equals 5 percent. c. Assume that the price level is fixed. What happens to the equilibrium interest rate if the supply of money is raised from 1,000 to 1,200? – If the price level remains fixed at 2 and the supply of money is raised from 1,000 to 1,200 ...
Midterm #2
... 13. According to the Lucas Misperceptions Model, changes in output can be caused by increases in the money supply, as long as the increases in the money supply are: a. b. c. d. e. ...
... 13. According to the Lucas Misperceptions Model, changes in output can be caused by increases in the money supply, as long as the increases in the money supply are: a. b. c. d. e. ...
PANEL
... indicator, and of the difference between the effects of changes in credit and money can be obtained by contrasting two frameworks. In one view, monetary and fiscal policies are seen as the means by which the public sector offsets instability in the economy resulting from changes that occur in the pr ...
... indicator, and of the difference between the effects of changes in credit and money can be obtained by contrasting two frameworks. In one view, monetary and fiscal policies are seen as the means by which the public sector offsets instability in the economy resulting from changes that occur in the pr ...
