ECON 4131, International Finance, Spring 2002, Exam 3 Final Essay

7. From the documents, what inferences can you make about the “disastrous effects of the business cycle” for each group below:

This four-credit course is for students who major in finance. By the end of this course,

In our team paper, we are going to evaluate, assess, and apply various economic situations from a Keynesian and Classical perspective. As the global markets increase and decrease over time careful modifications of the economy of the United States need to be made. After a comprehensive assessment of the current economic situation team C has agreed, that the Current State of Interest Rates, unemployment, exceptions, and consumer incomes and spending are the distinct factors that have an influence on economic forecasting and growth. The US is still recovering from the financial crisis there is still some skepticism, despite recent signs in

c) In a recession, the Bank of Canada will conduct an open market purchase to lower the interest rate. The quantity of investment will increase, and other interest-sensitive expenditure items will also increase. With an increase in aggregate expenditure, the multiplier increases aggregate demand, bringing real GDP to equal potential GDP, and a recession will be eliminated.

The current state of the U.S. macro economy is made up of a plethora of highly involved processes. I am going to attempt to explain some simple terms and concepts focused on international trade and foreign exchange rates.

d) What two assumptions are included in calculating the maximum change in the money supply

9. Refer to the model and estimates in the previous question. Ceteris paribus, according to these

The unemployment rate in the town of Miami Lakes is 6.60%. The job growth in Miami Lakes is expected grow in an estimated rate of 0.18%. The growth in jobs is expected to rise in the next ten years and is estimated to grow to the percentage of 33.80%. When the ten years are over the numbers should go down from 6.60 to a much less percentages which will help people economic wise. The growth in jobs will give people the opportunity to be employed and avoid to be in an economic

The financial crisis of 2008 has been described as the worst financial crisis the world has seen since the great depression, but there are now murmurings of the potential for an even greater financial crisis, a currency crisis, caused by the demise of the US Dollar. The Dollar has been the reserve currency of the world since it took over from the Pound at the end of world war two, but we examine if it is about to crash spectacularly?

a.     Brikerhoff International, Inc. is currently in an economic boom following 8 years of economic depression

Such a process can be very time consuming and imprecise, without, of course, having a market currency price to begin with. The exchange-rate system is an important topic in international economic policy. Policymakers and journalists often seem to treat the choice of exchange-rate system as one of the most important economic policy choices that a national government makes, on a par with free international trade. Under most circumstances and for most countries, a system of freely floating exchange rates is likely to be a better choice than attempting to peg the exchange rate.

Q1. Use the Cyclic Innovation Model (Fig 1.9, pg 30) figure to illustrate the innovation process in this case and provide a brief description?

1. The gold standard and the money supply. Under the gold standard all national governments promised to follow the “rules of the game”. This meant defending a fixed exchange rate. What did this promise imply about a country’s money supply? A country’s money supply was limited to the amount of gold held by its central bank or treasury. For example, if a country had 1,000,000 ounces of gold and its fixed rate of exchange was 100 local currency units per ounce of gold, that country could have 100,000,000 local currency units outstanding. Any change in its holdings of

The elasticity of the money supply (MV) is what allows and facilitates the disequilibria of business cycles. By expanding the currency, malinvestments in capital are generated, which are not productive enough to be maintained (Haney, 681).

Discuss the role of government policy in reducing unemployment and inflation. In your discussion make use of the diagrammatic representation of the macroeconomy developed in lectures in Term 2