Answered: interpret the monetary and fiscal…

interpret the monetary and fiscal policies as either expansionary or contractionary. Define which school of thought supports each of the polices.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter14: Macroeconomic Policy: Tradeoffs, Expectations, Credibility, And Sources Of Business Cycles

Section: Chapter Questions

Problem 6E

See similar textbooks

Related questions

Q: One of the three main tools of the Federal Reserve is fiscal policy. True False

A: Central Bank: The central bank is the apex bank of the country that supplies the money or maintains…

Q: Consider the following quote: "Over one and a half million people were laid off from jobs following…

A: For transportation of goods and materials across the nation, mostly petrochemicals were used. So…

Q: a) Explain whether a contractionary or an expansionary fiscal or monetary policy should be…

A: Monetary policy: It refers to the policy used by the central bank for the benefit of the economy.…

Q: Use the following information for this problem: Goods Market: Asset Market: C = 3+0.5(Y-T) MS =…

A: C = 3+0.5(Y-T) MS = 25/P Assume that the P=1 initially I = 12-50r MD = Y - 50r T = 10 G = 10

Q: 44. According to the Monetarists, excessive government spending, whether financed by borrowing or…

A: Monetarist: It refers to the theory under which money supply will be increased that help in…

Q: The Federal Reserve System's Board of Governors and the Federal Government both maintained…

A: Expansionary or loose policy refers to a macroeconomic policy that promotes economic growth. It is a…

Q: Recently the economic conditions of the country have been weakened. Even though inflation has not…

A: Hi! Thank you for the question, As per the honor code, we are allowed to answer three sub-parts at a…

Q: the Federal Reserve attempts to grow the money supply in a recession. How does such a stimulus…

A: It's commen policy that central bank increase money supply in an economy during recession period.

Q: Which of the following is an example of monetary policy?

A: The Monetary Policy is referred to as a policy that is undertaken by the Central Bank of an economy…

Q: PLEASE EXPLAIN IN DETAIL: 1) Public Borrowing and Crowding Out Effect. 2)Crowding Out Effect in…

A: The two schools of thoughts: Monetarist approach and Keynesian approach, are very important for the…

Q: Determine how each of the following monetary or fiscal policy would shift the aggregate demand…

A: Aggregate demand shows combinations of price and output demanded in the economy. It is a sum of…

Q: When the economy is in recession and the Fed wants to do expansionary policy, explain what all 4…

A: In the United States, Fed is the central bank who performed Monetary policies to deal with business…

Q: The monetary transmission mechanism can be depicted in the form of a graph or using symbols.Explain,…

A: Hi, thank you for the question. As per our Honor code, we are allowed to attempt only the first…

Q: The monetary transmission mechanism can be depicted in the form of a graph or using symbols. 3,1…

A: The monetary transmission mechanism shows the ways through which monetary policy (MP) affects the…

Q: POTENTIAL GDP REAL GDP PRICE LEVEL 2020 $1500 billion $1500 billion 100 2021 $1590…

A: Potential GDP is the level of GDP when the economy utilizes its resources fully, that is the economy…

Q: Answer all questions. For each question, identify the statement as True, False, or Uncertain, and…

A: Fiscal policy: It refers to the policy that is used by the government to help the economy. The…

Q: Using short-hand symbols explain the effects of a; a)contractionary fiscal policy.…

A: a. Effects of contraction of fiscal policy: Decrease in aggregate demand - AD will fall Consumption…

Q: Hello, I would like help with this assignment Thank you! Monetary Policy Assume the economy is…

A: a.Inflation is a situation in the economy, when there is general rise in the price level of goods…

Q: Use the monetary approach to answer each of the following. Be sure to spell out your assumptions…

Q: Policy? Statement 1: An inside lag exists between the time a policy change is needed and the time…

A: Fiscal policy refers to the actions taken by the government to interfere in the economy. Monetary…

Q: The President is getting ready for a press conference, and needs quick advice on "closing the…

A: The fiscal policy is the policy of the government in the economy to control the spending levels of…

Q: 3a). Explain what the Fed should do to remove a recessionary gap. Illustrate the effect of its…

A: Goods market equilibrium is achieved when aggregate demand and aggregate supply are equal at certain…

Q: In the most recent FOMC meeting, the Federal Reserve increased the Federal Funds rate. By doing…

A: In the mentioned question we have been asked what will happen if federal fund rate is increased.

Q: Q.1.18 The implementation lag is for monetary policy and for fiscal policy. (1) Extremely short;…

A: An implementation lag occurs when there is a delay between the duration of beginning of an economic…

Q: For each of the following scenarios, indicate if it would necessarily lead to crowding out or not,…

A: Answer: (g). Graphical presentation: According to the above figure, the x-axis measures the real…

Q: 9. Which of the following will result in expansionary monetary or fiscal policy being the LEAST…

A: Both the expansionary fiscal policy and the expansionary monetary policies aim at increasing the…

Q: 1- The Federal ________________________________________ (the Fed) is the primary force in…

A: The central bank is the apex body which is responsible for maintaining the money supply in the…

Q: e. Solve for the equilibrium values of C and 1, and verify the value you obtained for Yby adding C,…

A: IS the consists of different sets of interest rates and output at which the total investment equals…

Q: 3. When discussing if policy should be active or passive to stabilize the economy, there is a…

A: Stabilization policies refer to the policies implemented by the governments and central banks to…

Q: In the most recent FOMC meeting, the Federal Reserve increased the Federal Funds rate. By doing…

Q: a) Discuss monetary policy and fiscal policy by comparing and contrasting their effects in the short…

A: The monetary policy of the economy is conducted by the central bank of the economy and the monetary…

Q: In what ways does the Fed utilize their monetary policy tools to affect or counter-balance fiscal…

A: Fiscal policy refers to the method of government spending and tax policies to take a control over…

Q: 3.6 Explain why the timing of fiscal policy may be more difficult than the timing of monetary…

A: 3.6) Fiscal policy: It refers to the change in tax structure and government spending by the…

Q: Assume there is a desire to reduce unemployment in an economy. Describe two (2) expansionary fiscal…

A: To reduce unemployment, government should implement expansionary fiscal policy using following…

Q: I need a quickly answer. Critically evaluate and explain with help of graph (s) that monetary…

A: The monetary policy involves the quantity of the monetary policy in the economy. The money supply…

Q: 1. As a result of an economic policy change, interest rates fall, and consumption and investment…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Which of the following statements is true?a. Keynesians advocate increasing the moneysupply during…

A: Keynesian economist critized the classical economy during the great depression of 1930's and argued…

Q: Give and explain briefly the sequential parts or stages of the policy process

A: A policy is a set of guidelines or recommendations issued or offered by an organization to aid in…

Q: the interest

A: Fiscal policy is the use of government spending and tax policies in order to influence economic…

Q: 4. Under the fixed FX regime, the fiscal policy is used to change income level Is used to reduce…

A: Fiscal policy: These are the policy measures which is being introduced by the government of a…

Question

100%

4.This is a two-part assignment using the links below plus additional resources. Using the below links interpret the monetary and fiscal policies as either expansionary or contractionary. Define which school of thought supports each of the polices. Make sure to cite at least three sources either in MLA or APA style and have a minimum of 250 words. Here are some sources to get started https://www.whitehouse.gov/issues/budget-spending/ (Links to an external site.) https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Do you think the typical time lag for fiscal policy is likely to be longer or shorter than the time lag for monetary policy? Explain your answer?
please answer all question, it's really matter ( not very long, just short understandable answers) 1. What are the roles for fiscal policy that might be less effective if left to monetary policy? 2. What are some clear advantages of monetary policy over fiscal policy? 3. Why did it take so long for the US government to adopt effective use of monetary policy?
The table above shows Econland’s economy aggregate demand and aggregate supply schedules. Econland’s potential GDP is $400 billion. (4). Does Econland have an inflationary gap or a recessionary gap? (5). What is the size of the gap? (6). What specific fiscal policy would you prescribe to close the gap? (7). What specific monetary policy would you prescribe to close the gap?
1. Give and explain briefly the sequential parts or stages of the policy process.
The table above shows Econland’s economy aggregate demand and aggregate supply schedules. Econland’s potential GDP is $400 billion. (6). What specific fiscal policy would you prescribe to close the gap? (7). What specific monetary policy would you prescribe to close the gap?
Read the following quote and explain in complete sentences whether it discusses fiscal policy, monetary policy or both. “Taking substantial action at this point, though, would send what could be a negative message to the market — that the balance sheet runoff, which former Chair Janet Yellen said would be ‘like watching paint dry,’ is running into snags and requires corrective action. However, the Fed would have no choice if there are indications that it can't control the market movements, particularly considering the record level of Treasury debt the government has issued this year.”
1. Increasing government spending when the economy is in a recession is an example of: A. active monetary policy B. active fiscal policy C. passive monetary policy D. passive fiscal policy 2. Because monetary and fiscal lags are long and variable: A. stronger policies must be used B. successful stabilization policy is completely impossible C. attempts to stabilize the economy are often destabilizing D. policy must be completely passive
Explanation it correctly Q)Explain on a table the differences between the two macroeconomic multipliers (fiscal policy, monetary policy) studied in the second part of the course.
1. The monetary transmission mechanism can be depicted in the form of a graph or using symbols.Explain, with the aid of symbols, the monetary transmission mechanism when interest rates increase (Note: Prices and wages are variable.)2. Explain, using the AD‐AS model, how the South African Government can use fiscal policy as a tool to recover from the negative effects of this COVID‐19 pandemic.Your answer must include the following:  The description of the type of fiscal policy required;  An explanation of how the implementation of this tool will work their way through the economy to achieve the desired effect;  The AD‐AS graph showing the implications of your recommendations. (5)Marks will be awarded for your ability to integrate theory with the scenarioprovided.
What specific monetary policy tools would you use to stimulate aggregate demand and how? What specific fiscal policy tools would you use to stimulate aggregate demand and how?
4. What is the different between Monetary Policy and Fiscal Policy? Short answer
44)Which of the following statements is most accurate regarding fiscal policy and monetary policy? Select one: a. Monetary policy can be changed more quickly than fiscal policy. Fiscal policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change fiscal policy. b. Fiscal policy can be changed more quickly than monetary policy. Fiscal policy has much shorter delays due to the smaller number of legislators involved. c. Monetary policy can be changed more quickly than fiscal policy. Monetary policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change monetary policy. d. Fiscal policy can be changed more quickly than monetary policy. Monetary policy has much longer delays due to the larger number of legislators involved.