Disequilibrium in BOP due to a persistent deficit or surplus is called as Select one: a. Secular disequilibrium b. Circular disequilibrium c. Structural disequilibrium d. Short run disequilibrium e. Cyclical disequilibrium
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- suppose the rconomy is initially in macroecnomic equilibrium with ab output gap of 0% unexpected inflation of 0% and inflation expectations of 2%. A war in the middle East disrupts oil prices. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Real Business Cycle Model The government of “Defitonia” only relies on lump-sum taxes to finance its expenditures, and is evaluating a fiscal consolidation plan to bring down its fiscal deficit. Two alternatives are being assessed: increasing current taxes, or cutting current government expenditures. In this problem, you will analyse both alternatives through the lens of the Real Business Cycle (RBC) model studied in class. (a) Suppose that the government of Defitonia increases current taxes, but does not change its level of spending in either period. What are the effects of the tax change on the real wage, employment, the real interest rate, and output? Explain by using the equilibrium diagrams for the current labour market and for the current goods market in the RBC model. (b) Now suppose that the government of Defitonia cuts current government spending. What are the effects of the tax change on the real wage, employment, the real interest rate, and output? Explain by using the…Please match each description with the appropriate approach to federal finance. Policymakers should reduce spending and increase taxes when the economy is growingin order to prevent "overheating".This approach was considered conventional wisdom until the advent of theGreat Depression.Policymakers should focus on keeping unemployment low and providing the peoplewith the public goods and services they want.If insisted upon, this approach would only worsen the economy during a recession.This approach ignores the impact of the budget on the business cycle. Answer bank in image
- Identify the arguments in favor of (pro) and opposed to (con) the case of government intervention to stabilize economic cycles. Not all arguments will be placed. - It is not possible to reject evidence in favor of the Phillips curve - Aggregate demand takes time to accommodate interest rate movement - Economist have not been able to correct their overestimation of the multiplier of fiscal policy - Macroeconominst have not been able to accurately measure recessions - There is a well documented set of policies than can attenuate business cycle fluctuations - Householders are well suited to predict early the effects of monetary policyAssume the Pakistan’s economy is in recession:Pakistan implements a combination of expansionary fiscal and monetary policy. In the absence of complete crowding out what will be the effect of these policies on each of the following: Aggregate demand in Pakistan The price level in Pakistan Interest rates in PakistanAssume the Pakistan’s economy is in recession: Pakistan implements a combination of expansionary fiscal and monetary policy. In the absence of complete crowding out what will be the effect of these policies on each of the following: Aggregate demand in Pakistan The price level in Pakistan Interest rates in Pakistan
- If C + I + G + (X - M), is more than current production, then a. inventory stocks will fall, leading businesses to increase production, causing GDP to rise. b. the economy may experience deflation if the imbalance is not corrected by government stabilization policy. c. inventory stocks will pile up, leading business to trim production, causing GDP to fall. d. the price level will probably decrease.What is the Australian Government's monetary and fiscal policy stance in the current phase of the business cycle? Explain the rationale for this stance of macroeconomic policy. What are the implications for output and employment growth of the stance of monetary and fiscal policies? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure.What is the Australian Government's monetary and fiscal policy stance in the current phase of the business cycle? Explain the rationale for this stance of macroeconomic policy. What are the implications for output and employment growth of the stance of monetary and fiscal policies? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
- "Inflation tax" means that: Select one: a. as the price level rises, taxpayers are pushed into higher tax brackets. b. as the price level rises, the real value of money held by the public decreases. c. as taxes increase, the rate of inflation also increases. d. in a hyperinflation, the chief source of tax revenue is often the printing of money.options: a contractionary fiscal a contractionary monetary a recessionary an expansionary fiscal an expansionary monetary an inflationary equal to greater than grew inflation less than receded the same as unemployment35 When a recessionary gap exists, actual output______ potential output and the rate of inflation will tend to ____. a. is less than; decrease b. is less than; increase c. exceeds; decrease d.equals; remain the same e.exceeds; increase
