With the helps of diagrams of money market, IS-LM and AS-AD, demonstrate and explain the effects of decrease in demand for money as a result of greater use of payment technologies in promoting economic growth.
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- provide a pre-Covid assessment and current-Covid analysis of the impact of inflation in order to illuminate on the difference due to the health crisis on the Australian economy(note: use Keynesian school theory, AD-AS model to explain the movement of inflation and data analysis and tools to solve) also provide reference to those findingsEconomic activity should continue to expand at a similiar rate to 2021's projected rebound, on the back of solid domestic demand and robust export growth. However, tighter monetary policy amid relatively elevated inflation will likely dampen momentum, while the new covid 19 variants pose a large risk to activity given the country's law vaccination rate. The panel sees the economy expanding 4.0% in 2022, which is unchanged from last month and growing 2.6% in 2023. Jamaica economy, GDP, Inflation, CPI and interest rate ( focus economics.com) Question 1) The accelerator theory suggests that planned investment depends on the rate of change in real output, provide three contributors which would result in the expansion of economic activity. 2) Explore at least 3 importance of Foreign Direct Investment which could result in expanding the economy by 4% in 2022. 3) Describe how inflation will affect income inequality in Jamaica.Economic activity should continue to expand at a similiar rate to 2021's projected rebound, on the back of solid domestic demand and robust export growth. However, tighter monetary policy amid relatively elevated inflation will likely dampen momentum, while the new covid 19 variants pose a large risk to activity given the country's law vaccination rate. The panel sees the economy expanding 4.0% in 2022, which is unchanged from last month and growing 2.6% in 2023. Jamaica economy, GDP, Inflation, CPI and interest rate ( focus economics.com) Question 1) According to the article tighter monetary policy and relatively elevated inflation will likely dampen momentum, explain how the government can intervene to stablize the economy. 2) Evaluate three measure used by the government to address poverty in a caribbean country of your choice.
- which of the following are true statements about another growth model - the Quantitative Theory of Credit? [Multiple select] Credit creation drives nominal GDP growth and asset price inflation. Banks are only financial intermediaries between borrowers and lenders. Empirically, in the 20th century, the velocity of money is usually constant over time when money is defined as M0, M1. . .M5. A large ratio of Cr/C can lead to bank crashes and recession.Consider two countries, A and B. In A, new technologies (e.g., mobile payment apps and cryptocurrencies) have been enthusiastically adopted by the population, thereby reducing the proportion ofincome that is held as real money balances. Over this period, no such changes occurred in B. Ifthe rate of money growth and the growth rate of real GDP were the same in A and B over thisperiod, then how would the rate of inflation differ between the two countries?good day kindly assist Which of the following measures may assist the SARB in decreasing the money supply in the economy to“tame inflation”?A. An increase in the currency held by the publicB. An increase in government spendingC. A decrease in interest ratesD. An increase in bank lending
- Money as a factor of production. (This is adapted from Dorn busch and Frenkel 1973.) Consider the Sidrauski model presented in section 4.5. Assume, however, that money services are also an input in production. A simple formalization is that production is given by and v tends to zero as m goes to infinity. Assume for simplicity that n = 0. Characterize the steady state, and contrast the effects of money growth with those obtained in the original Sidrauski model.Necessary and Sufficiency Conditions Graphically prove the following necessary condition given to us by economist Gottfried Haberler: An increasing supply of money and credit is a necessary condition for the occurrence of a long-run boom in the business cycle Verbally derive the sufficiency condition that there is a sufficient rate of growth in the money supply and credit to establish and maintain the boom of the business cycle What is the key assumption made in the necessary condition proofAssume the following IS-LM model: expenditure sector: money sector: AD = C + I + G + NX I = 300 - 20i M = 700 C = 100 + (4/5)YD G = 120 P = 2 YD = Y - TA NX = -20 md = (1/3)Y + 200 - 10i TA = (1/4)Y How much investment (I) will be crowded out if the government increases its purchases by deltaG = 160 and nominal money supply (M) remains unchanged?
- Consider a small open economy with no perfect capital mobility whose Central Bank is explicitly targeting price level. If the government decides to decrease the tax level, what would happen with a new equilibrium domestic price level and real output? What the response of Central Bank should be? Please show your solutions using the model that we have developed (be sure to use BB and GM curves).The data below are from the economies of Ishgandar and Nonburmia. Ishgandar Nonburmia Year Population GDPGDP Deflator Nominal GDPGDP Year Population GDPGDP Deflator Nominal GDPGDP 1 5 100 $200 1 10 100 $300 2 5 125 $375 2 10 110 $440 (b) If Ishgandar and Nonburmia have the same velocity of money in Year 22, which economy must have the higher money supply in Year 22 ? Explain.in a borrowing agreement, who wins and loses when inflation is unexpectedly low? Explain how unexpectdly low inflation creates a transfer of purchasing power when money is borrowed and lent.