What are the inside lag and the outside lag? which policy has the longer inside lad? which policy has the longer outside lag? why?

Q: 1. Which of the following definitions is INCORRECT? Group of answer choices Administrative lag:…

A: The lag effect refers to the time period between policy action and actual effects on the economy.

Q: Why is the income elasticity of demand for money in precautionary motive, greater than the income…

A: In an economy , people make demand for money for different purposes such that transaction demand ,…

Q: d) Taxes decrease and at the same time the Fed increases the RRR

A: d. Taxes decrease and at the same time FED increases the RRR Primarily as a result of their…

Q: List and describe thefactors that affectthe money marketand the equilibriuminterest rate

A: The equilibrium in the money market is established when the money supplied by the monetary authority…

Q: e the channels through which the cash rate influences Monetary pol

A: Official money rate (OCR) is the pace of interest charged by the national bank on for the time being…

Q: 34: What is the prompt impact on target supply if Bank A receives a store of $ 1000 in money from…

A: The money supply is the total amount of money supply in the economy The monetary supply consists of…

Q: Fed

A: These are two different scenarios. However, both of them fall into the same category i.e., economy…

Q: How can forward guidance as a tool of the central bankimpact the policy instrument, intermediate…

A: Forward guidance is a tool of central bank monetary policy and is used to change the policy…

Q: Suppose the economy is initially at long run equilibrium, when there is an unexpected decrease in…

A: When an economy is in long-run equilibrium and the price of oil falls unexpectedly, the demand for…

Q: The country of Safrica has a progressive tax system and pays unemployment benefits through an…

A: Unemployment compensation or benefits are paid to the people who are out of job and are unable to…

Q: If inflation was 1% which policy would be use ? (Contractionary or expansionary )

A: Inflation is defined as the rate at which prices rise over time. Inflation is usually defined as a…

Q: Which of the following is the result of more M1 in the economy? A. rising prices due to more money…

A: In an economy, M1 money supply is the total money available with the household and liquid money held…

Q: Why did Friedman and the Monetarists believe that monetary misuse accompanied every severe recession…

A: Inflation means the rise in the price level of goods and services in an economy. It means as the…

Q: what do you understand by monetary targeting ? what are the condition for a good targets?

A: The economies around the world tend to work upon the basis of various economic entities, such as the…

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

A:

Q: Larry Summers, Professor of Economics at Harvard and ex-Treasury Secretary and Chief Economist at…

A: Macroeconomics is used to study the various economic measures that firms and a country's government…

Q: When the demand for money is greater than the supply of money:     A) people offering to…

A: Money demand is the demand for cash balances by the individuals in the economy.Money supply is the…

Q: Central bankers in Widgetsa have decided that inflation is too high and contractionary monetary…

A: Central bankers in Widgetsa have decided that inflation is too high and contractionary monetary…

Q: Exercise Suppose you are the governor of the Central Bank, and you carry out an inflation targeting…

A: Answer: Inflation refers to the general increase in the price level in the economy. The central bank…

Q: Suppose the U.S. economy is initially at long run equilibrium, when there is an unexpected economic…

A: Since you have posted a question with multiple parts, we will solve only the first part. To get…

Q: Keynesian economists believe that __________________. Group of answer choices A. the velocity of…

A: The theory of Keynesian economics states that the government should increase demand to improve…

Q: A monetary policy target is a variable that O the Fed can affect directly. O equals one of the Fed's…

A: In an economy, monetary policy refers to one of the type of macroeconomic policy to influence the…

Q: Using two teams, initiate an argument that agrees (Pro) with the Fed actionand an argument that…

A: Fed is the central body which governs the monetary policy of the country and controls the financial…

Q: According to the quantity theory of money (MV=PQ), how lowering interest rates by the CB affect…

A: The central bank is the apex monetary authority of an economy that is assigned the responsibility to…

Q: Assume the economy is characterized by rational expectations. If the Federal Reserve seeks to…

A: Considering the rational expectations of the consumers in the economy, when the federal reserve try…

Q: In the market for reserves, if the Federal Reserve Bank increases the required reserve ratio, this…

A: Required reserve ratio:- A required reserve ratio can be explained as the percentage of assets which…

Q: The Fed believes if inflation is high and GDP is high, unemployment is likely to:   a. Increase…

A: Unemployment, the state of one who is equipped for working, effectively looking for work, however…

Q: Suppose the U.S. economy is initially at long run equilibrium, when there is an unexpected economic…

A: Since you have posted a question with multiple parts, we will solve only the first part. To get…

Q: Suppose the U.S. economy is initially at long run equilibrium, when there is an unexpected economic…

A: When the U.S economy is in long-run equilibrium and there is an unanticipated economic boom across…

Q: At their last meeting, the Fed indicated that it would begin reducing its purchases of longer-term…

A: Treasuries are government securities. These securities are for short term as well as for long term.…

Q: Within the aggregate demand-aggregate supply framework, monetarists argue that a change in aggregate…

A: Monetarist believes that the money supply is the main factor to stimulate the economy.  A change in…

Q: In case of high inflation, the Federal Reserve normally O buys governmeñt bonds O sells government…

A: Fed uses open market operations in order to alter money supply in the economy.

Q: How would you characterize RBI's forex policy

A: RBI is the central bank of India that aims to maintain a stable monetary policy in an economy and…

Q: What kind of monetary policy should the Fed use if the economy is currently in the northwest area of…

A: Inflation is the rise in average general price level over period of time . Here , inflation and…

Q: What do monetarists predict will happen in the short run and the long run as a result of each of the…

A: long-run equilibrium:-In a completely competitive market, when marginal revenue equals marginal…

Q: If all banks heeded Shakespeare's admonition "Neither a borrower nor a lender be,” what would happen…

A: The main job of the bank is to collect the savings of the individuals that is kind of borrowing from…