9. Why is money supply related to a country’s balance of payments? If China decides to...
9. Why is money supply related to a country’s balance of payments? If China decides to consumes its stock of foreign exchange reserves, what will happen to China’s money supply and inflation? Explain. 10. Explain how we should measure the openness of an economy. Please compute your country’s trade/GDP ratio an compare that with that of China.
Since 2008, the money supply has almost quadrupled, going from
$1.4t to $5.3t. At the same time, the Real GDP (the actual amount
of goods and services produced by the economy has increased by a
modest 23%, equivalent to an average growth of just under 2% per
year.
We expect that a large increase in the money supply without a
corresponding increase in the Real GDP would cause a very large
increase in inflation. In fact, since 2008 inflation has...
Since 2008, the money supply has almost quadrupled, going from
$1.4t to $5.3t. At the same time, the Real GDP (the actual amount
of goods and services produced by the economy has increased by a
modest 23%, equivalent to an average growth of just under 2% per
year.
We expect that a large increase in the money supply without a
corresponding increase in the Real GDP would cause a very large
increase in inflation. In fact, since 2008 inflation has...
QUESTION 9. In recent years, it has been suggested that both China and the US have engaged in currency manipulation or ‘competitive devaluations’. All else the same, from this we can conclude: A. Chinese goods will be less expensive in US markets in the short-run, but US goods will be more expensive in China. B. US goods will be less expensive in China in the short-run, but Chinese goods will be more expensive in the US. C. Chinese and US made goods...
Chapter 12: What is money? What are the three functions of money? What is the difference between fiat money and commodity money? How can banks affect the money supply? What is the reserve ratio? What is the money multiplier? How did banking develop? How are required reserves different from excess reserves? Know the differences between bond markets, stock markets, banks, and mutual funds, and know the characteristics of bonds, stocks, banks, and mutual funds. How do banks help solve problems...
1.
2.
If the Fed wants to reduce the money supply through open
market operations, it will
Select the correct answer below :
sell bonds
buy bonds
Oreduce the required reserves ratio
reduce the discount rate
3.
A growing debt/GDP ratio could mean that, all else the
same,
Select the correct answer below:
the government is running large budget deficits
the government is paying down the debt
government expenditures are less than tax revenues.
the economy is in a growth...
Read the article on China’s Forex Reserve . In your opinion and from the article, why had China’s foreign reserve kept dropping? What would be the Chinese government’s motivation in lowering its foreign reserve at the time the article was published? China Foreign-Exchange Reserves Keep Dropping; Reserves fall to lowest levels in nearly six years, testing central bank's resolve to stabilize the yuan Wei, Lingling . Wall Street Journal (Online); New York, N.Y. [New York, N.Y] 08 Jan 2017: n/a....
Read The Article Below And Give A Brief Description In Your Own Words. Do You Agree Or Disagree With The Article? Explain (Maximum 150 Words) BEIJING — China’s central bank moved on Friday to give the country’s slowing economy a jolt, saying it would essentially inject $126 billion into the financial system as Beijing fights an escalating trade war with the United States and contends with a dangerous addiction to debt at home. The move signaled China’s willingness to ease...
Case assignments must be completed with a written 2-page study on the assigned case questions in the textbook. The format requested for these assignments is based on elaborating and including two basic parts in the essay: 1) in a bullet presentation style (one phrase each bullet), list a summary of the key issues, situations, problems, opportunities and threats you may identify as relevant; 2) answer all the questions listed in each case in two or three sound paragraphs. Use the...
1. Use the information in the following table to calculate: a. the adult population b. the labor force c. the labor-force participation rate d. the unemployment rate Employed Unemployed Not in the labor force 142,263,000 10,112,000 82,932,000 2. Assume that the reserve requirement is 3 percent. All other equal, will the money supply expand more if the Federal Reserve buys $3,000 worth of bonds or if someone deposits in a bank $3,000 that he had been hiding in his cookie...