Directions: Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow Over the past 3 years, prices in Belarus have risen by 4%, as overall economic growth has increased by 5% while unemployment rates are 1.3%. Aram is finding that all goods, even necessities cost more at the stores. He is worried he may have to cut back on certain purchases. The Business Cycle and the Problem a. What stage of the business cycle is the economy currently in? Blank 1 Blank 2 b. What is the current problem in the economy? Blank 3

Directions: Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow Over the past 3 years, prices in Belarus have risen by 4%, as overall economic growth has increased by 5% while unemployment rates are 1.3%. Aram is finding that all goods, even necessities cost more at the stores. He is worried he may have to cut back on certain purchases. The Business Cycle and the Problem a. What stage of the business cycle is the economy currently in? Blank 1 Blank 2 b. What is the current problem in the economy? Blank 3

Macroeconomics

13th Edition

ISBN:9781337617390

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter16: Expectations Theory And The Economy

Section: Chapter Questions

Problem 7QP

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Directions:Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow Over the last two years, the unemployment rate in Westerlight has risen from 4% to 8%, while GDP growth has been 1.5%. Milo, a citizen of Westerlight, currently doesn’t have a job and although he is actively searching, has been unable to find one. The Business Cycle and the Problem a. What stage of the business cycle is the economy currently in? Blank 1 b. What is the current problem in the economy? Blank 2 c. Does it need money in or out of the economy? Blank 3 d. What type of monetary policy is that? Blank 4 e. What type of fiscal policy is that? Blank 5 f. Doing any of these will Blank 6 the money supply and availability of credit.
directions:Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow Over the past 3 years, prices in Belarus have risen by 4%, as overall economic growth has increased by 5% while unemployment rates are 1.3%. Aram is finding that all goods, even necessities cost more at the stores. He is worried he may have to cut back on certain purchases. The Results As the money supply (increases/decreases) Blank 1 , businesses will get (more/less) Blank 2 money and eventually unemployment (increases/decreases) Blank 3 . When that happens Aram will see prices (rise/fall) Blank 4 as the economy (expands/contracts) Blank 5
Directions:Use the given scenarios and the information you have learned about Fiscal and Monetary policy to complete the questions that follow The economy of Andorra is currently experiencing unemployment rates of 5% while economic growth is stagnating at 2%. Naomi recently lost her job as a systems analyst and is struggling to find new employment in the current economic conditions. The Federal Reserve notices this change in the economy and decide to take steps to correct it. They can use their 4 tools in the following ways: a. What will the Federal Reserve do to open market operations? Blank 1 b. What will the Federal Reserve do to the reserve requirement? Blank 2 c. What will the Federal Reserve do to the discount rate? Blank 3 d. What will the Federal Reserve do to the interest on reserves? Blank 4 e. What impact will this have on loans from banks? Blank 5
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Macroeconomics deals with the analysis of all of the following questions except Question 18 options: a) Why do nation’s grow? b) How does a central bank increase a nation’s money supply? c) Why does a country experience inflation d) How does Microsoft price its software packages?
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