True or False: A restrictive monetary policy is strengthened by a decline in net exports.
True or False: A restrictive monetary policy is strengthened by a decline in net exports.
Homework Answers
A restrictive monetary policy is designed to reduce the aggregate spending which shifts the aggregate demand curve to the left by reducing the money supply. At this time, if there is decline in the net exports, this would further decrease in the aggregate spending so that AD curve shifts left further. Hence monetary contraction is supported by falling net exports
True.
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True or False: A restrictive monetary policy is strengthened by a decline in net exports.
Why may an expansionary monetary policy be less effective than a restrictive monetary policy? the Federal...
Why may an expansionary monetary policy be less effective than a restrictive monetary policy? the Federal Reserve Banks are always willing to make loans to commercial banks which are short of reserves. commercial banks may not be able to find loan customers. fiscal policy always works at cross purposes with an expansionary monetary policy. changes in exchange rates complicate an expansionary monetary policy more than it does a restrictive monetary policy.
During a period of high unemployment the Federal reserve will use: Multiple Choice restrictive monetary policy...
During a period of high unemployment the Federal reserve will use: Multiple Choice restrictive monetary policy to decrease excess reserves in hopes of decreasing interest rates, expansionary monetary policy to increase excess reserves in hopes of decreasing interest rates. restrictive monetary policy to decrease excess reserves in hopes of increasing interest rates. expansionary monetary policy to increase excess reserves in hopes of increasing interest rates.
With the help of an IS-LM diagram show the effect of restrictive monetary policy on output...
With the help of an IS-LM diagram show the effect of restrictive monetary policy on output under flexible exchange rates and with perfect capital mobility.
Discuss how monetary policy (e.g. stimulative or restrictive policy) affects the short-term and long-term rates, respectively,...
Discuss how monetary policy (e.g. stimulative or restrictive policy) affects the short-term and long-term rates, respectively, and thus the yield curves.
Both monetary policy and fiscal policy affect aggregate demand. Group of answer choices True False
Both monetary policy and fiscal policy affect aggregate demand. Group of answer choices True False
Explain the process as well as the direction of causation, of a(n) [Expansinary, Restrictive ] monetary...
Explain the process as well as the direction of causation, of a(n) [Expansinary, Restrictive ] monetary policy? Use complete sentences and 500 to 700 words. Please explain in details Use economic theories and terminologies.
In an open economy, a loosening of monetary policy, in the short run, will cause: consumption,...
In an open economy, a loosening of monetary policy, in the short run, will cause: consumption, investment, and net exports to rise. consumption and investment to rise, but net exports will fall. consumption to fall, but investment and net exports will rise. consumption, investment, and net exports to fall. consumption to rise, but investment and net exports will fall.
46. The Federal Reserve’s tool to direct the economy is through monetary policy. a. True. b....
46. The Federal Reserve’s tool to direct the economy is through monetary policy. a. True. b. False.
III. Monetary policy under flexible exchange rates a. How does a monetary expansion in an economy...
III. Monetary policy under flexible exchange rates a. How does a monetary expansion in an economy with flexible exchange rates affect consumption and investment? b. How does a monetary expansion in an economy with flexible exchange rates affect net exports?
The Fed carries out monetary policy chiefly by influencing the demand for reserves schedule. a. True...
The Fed carries out monetary policy chiefly by influencing the demand for reserves schedule. a. True b. False
During a period of high unemployment the Federal reserve will use: Multiple Choice restrictive monetary policy to decrease excess reserves in hopes of decreasing interest rates, expansionary monetary policy to increase excess reserves in hopes of decreasing interest rates. restrictive monetary policy to decrease excess reserves in hopes of increasing interest rates. expansionary monetary policy to increase excess reserves in hopes of increasing interest rates.
III. Monetary policy under flexible exchange rates a. How does a monetary expansion in an economy with flexible exchange rates affect consumption and investment? b. How does a monetary expansion in an economy with flexible exchange rates affect net exports?
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