Take Home Examination 1 Macroeconomics by Alex Prindle 1. (10 points) What will be the expected changes to GDP in the next year? Explain by giving details about the impacts, if any, on C, I, G, and NX. Discuss the impact on real GDP vs. nominal GDP. The GDP should go up overall. The area of consumption should increase overall GDP, because when there are more jobs available and there is a great amount of job growth, more people will consume durable and non-durable goods. It states in the second
The Effect Monetary Policy has on Macroeconomic Factors Monetary policy includes the manipulation in the money supply by the Federal Reserve that will influence interest rates, which will cause a snowball effect in total overall spending. The change in interest rates, in many cases are a determining factor in the decision-making process to purchasing a house, a new car, borrow money for home improvements and many other decisions on purchases which will impact the total level of spending
The creation of Macroeconomics had two distinctive purposes (ACDCLeadership, 2014). These two purposes provide a measurement for the economy and act as a resolution for problematic situations (ACDCLeadership, 2014). There are three aspects which account for the measurement of the economy (ACDCLeadership, 2014). These three aspects are a recession, an inflationary gap, and full employment (ACDCLeadership, 2014). When a recession occurs there are three courses of action which can be applied to the
THE IMPACT OF EXCHANGE RATE FLUCTUATION ON MACROECONOMIC PERFORMANCE IN NIGERIA CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY This study is designed to examine the causes of exchange rate fluctuations and their impact on the Nigerian economy since there is scarcely any country that lives in absolute autarky in this globalised world. The economies of all the countries of the world are linked directly or indirectly through asset or/and goods markets. This linkage is made possible through
Instructor: Course: Date: Solve the Questions Has the Philip’s curve any use in modern macroeconomic policy-making? The Philip’s curve offers great importance in modern economic analysis. Philip’s curve shows the relationship between the rate of unemployment and the rate of inflation in any given economy. The discovery of Philip’s curve by the great British economist gave room for the analysis of modern macroeconomic policy tools as well as management of different economies around the globe. The curve
important role in the national economy. Through the formulation of macroeconomic policies and regulate the healthy operation of the national economy. There are four main economic theory tells us government to achieve macroeconomic objectives: price stability, full employment, sustainable and balanced economic growth and balance of international payments. In addition, inflation, unemployment and economic growth are the big macroeconomic issues of our time. In this essay we focus on inflation and unemployment
THE EFFECT OF MACROECONOMIC INDICATORS ON ECONOMIC GROWTH IN A PETROL-DOLLAR ECONOMY: THE NIGERIAN EXPERIENCE 1. Introduction The Central Bank of Nigeria Act of 1958(CBN) vested the monetary policy powers of economic stability on the apex regulatory bank (CBN).Since our independence in 1960,CBN has operated a fixed exchange regime which was at various times was at par with the British pounds and later the United States Dollar. This exchange rate regime was operated in addition
Taxes– the word which sent ripple effects once the mind interpreted the word. A surcharge, something paid above and beyond the good you’re paying for. At times one might burst boughs of anger in coloured word as your initial calculations on what you were going to pay are wrong. Wait a minute, those taxes are working for us– or are they? If you look at the economy at a macro level, it doesn’t take a genius to see that taxes are generally good. When looking at the expenditure approach GDP=C+I+G+Nx
Introduction New Classical Macroeconomics arose from the Monetarism and Rational Expectation School in the 1970s and follows the tradition of classical economics. If the market mechanism is allowed to play its role spontaneously, which could solve the unemployment, recession and a series of macroeconomic issues. Keynesian economists believe that changes in the money supply will lead to changes in effective demand that will changes in the total economy. For economic cycle fluctuation, Keynesian economists
Discuss how rising oil prices might affect the macroeconomic performance of an economy. (25 marks) There are four main macroeconomic objectives of the government it wishes to achieve in order to maximise the welfare of the society, they are: low and stable inflation, a favourable current account position on the balance of payments, low unemployment and sustained economic growth. One macroeconomic objective that might be affected by rising oil prices is the current account of the balance of payments