The more responsive investment spending is to changes in interest rates, the more effective monetary policy...
The more responsive investment spending is to changes in interest rates, the more effective monetary policy will be
True or False - why?
Homework Answers
True
Under the assumption that investment is inversely related to interest rate higher the interest rate lower the investment in the economy.The monetary policy is effective such situation in case of the deflation or inflation central banks manipulating the interest rate can effectively correct the fluctuation in the economy.
Add Answer to:
The more responsive investment spending is to changes in
interest rates, the more effective monetary policy...
and if C Monetary policy will be more effective if the money demand curve is and...
and if C Monetary policy will be more effective if the money demand curve is and I are sensitive to changes in the interest rates O flatter; very Osteeper; very steeper; not flatter; not
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.
Explain how fiscal policy (government spending and taxes) and monetary policy (determining interest rates) affect the...
Explain how fiscal policy (government spending and taxes) and monetary policy (determining interest rates) affect the level of output and employment in the economy according to Keynesian theory. What fiscal and monetary policies should the government follow to pull the economy out of a recession?
Suppose that investment (I) and consumption (C) in the goods market is not responsive to the...
Suppose that investment (I) and consumption (C) in the goods market is not responsive to the interest rate. Then The IS curve is a horizontal line and monetary policy is effective in raising output. The IS curve is a vertical line and monetary policy is effective in raising output. The IS curve is a horizontal line and monetary policy does not affect output in the IS-LM model. The IS curve is a vertical line and monetary policy does not affect...
WEEK 6: MONETARY POLICY AND FISCAL POLICY A healthy economy typically has low rates of unemployment...
WEEK 6: MONETARY POLICY AND FISCAL POLICY A healthy economy typically has low rates of unemployment and steady prices. Low rates of unemployment means that the economy is operating at its full potential. To ensure the economy continues to operate at potential GDP (full capacity where all savings are invested in production functions, and where all those who wish to work can find a job, and all other factors of production are fully utilized in the production function), governments use...
7. fiscal policy tool Show graphically that tax cuts are a more effective demand to interest rate...
7. fiscal policy tool Show graphically that tax cuts are a more effective demand to interest rates. the greater is the sensitivity of money Show graphically that monetary policy is a less powerful tool the greater is the sensitivity of money demand to interest rates. 8.
7. fiscal policy tool Show graphically that tax cuts are a more effective demand to interest rates. the greater is the sensitivity of money Show graphically that monetary policy is a less powerful tool...
Explain that fiscal policy is less effective than monetary policy in a situation when investment is...
Explain that fiscal policy is less effective than monetary policy in a situation when investment is very interest elastic and money demand is very interest inelastic.
Monetary Policy — End of Chapter Problems During the Great Depression, businesspeople in Canada were very...
Monetary Policy — End of Chapter Problems During the Great Depression, businesspeople in Canada were very pessimistic about the future of economic growth and reluctant to increase investment spending even when interest rates fell. This pessimism limited the potential for monetary policy to help alleviate the Depression because O decisions to change investment spending depend only on interest rates. O expansionary monetary policy leads to decreases in long-run aggregate supply when businesspeople are pessimistic. O a pessimistic outlook may override...
Question 100In an open economy with flexible exchange rates, monetary policy affects Not yet answered through changes in the real interest rate and affectsthrough changes in the Points out of 1.0...
Question 100In an open economy with flexible exchange rates, monetary policy affects Not yet answered through changes in the real interest rate and affectsthrough changes in the Points out of 1.00 exchange rate. r Remove flag Select one: A. Consumption and investment; net exports O B. net exports; taxes and saving o c. productivity and growth; consumption O D. taxes and saving; net exports
Question 100In an open economy with flexible exchange rates, monetary policy affects Not yet answered through...
Monetary policy created the 1980-82 recession by ___ and ___. a. raising interest rates to lower...
Monetary policy created the 1980-82 recession by ___ and ___. a. raising interest rates to lower spending, inflation and inflation expectations b. lowering interest rates to lower spending, inflation and inflation expectations c. moving the economy off the Gold Standard following the 1970s oil shocks d. raising taxes to take money out of the economy
and if C Monetary policy will be more effective if the money demand curve is and I are sensitive to changes in the interest rates O flatter; very Osteeper; very steeper; not flatter; not
Suppose that investment (I) and consumption (C) in the goods market is not responsive to the interest rate. Then The IS curve is a horizontal line and monetary policy is effective in raising output. The IS curve is a vertical line and monetary policy is effective in raising output. The IS curve is a horizontal line and monetary policy does not affect output in the IS-LM model. The IS curve is a vertical line and monetary policy does not affect...
7. fiscal policy tool Show graphically that tax cuts are a more effective demand to interest rates. the greater is the sensitivity of money Show graphically that monetary policy is a less powerful tool the greater is the sensitivity of money demand to interest rates. 8.
7. fiscal policy tool Show graphically that tax cuts are a more effective demand to interest rates. the greater is the sensitivity of money Show graphically that monetary policy is a less powerful tool...
Monetary Policy — End of Chapter Problems During the Great Depression, businesspeople in Canada were very pessimistic about the future of economic growth and reluctant to increase investment spending even when interest rates fell. This pessimism limited the potential for monetary policy to help alleviate the Depression because O decisions to change investment spending depend only on interest rates. O expansionary monetary policy leads to decreases in long-run aggregate supply when businesspeople are pessimistic. O a pessimistic outlook may override...
Question 100In an open economy with flexible exchange rates, monetary policy affects Not yet answered through changes in the real interest rate and affectsthrough changes in the Points out of 1.00 exchange rate. r Remove flag Select one: A. Consumption and investment; net exports O B. net exports; taxes and saving o c. productivity and growth; consumption O D. taxes and saving; net exports
Question 100In an open economy with flexible exchange rates, monetary policy affects Not yet answered through...
Most questions answered within 3 hours.
-
january 1 2010 road catering service purchase a piece of
equipment for 58000 which is expected...
asked 20 minutes ago -
Explain Mertons concept of anomie is and what the
modes of adaptation to it are?
asked 1 hour ago -
Jamie is doing a survey at her school about whether the students
feel the cafeteria food...
asked 2 hours ago -
How many liters of 0.669 M KOH will be needed to raise the pH of
0.339...
asked 4 hours ago -
A liquid of density 1270 kg/m 3 flows steadily through a pipe of
varying diameter and...
asked 5 hours ago -
Questions: What should the American executive do?
'A visiting American executive finds that a foreign subsidiary...
asked 5 hours ago -
Activity based costing was introduced as an alternative to
absorption costing.
1. Discuss using illustration the...
asked 5 hours ago -
1. You own shares of Crane DVD Company and are interested in
selling them. With so...
asked 5 hours ago -
How many grams of He are necessary to fill a balloon having a
volume of 4.5E3...
asked 5 hours ago -
The 2 patients, still in the hospital, were interviewed by a
MoH epidemiologist. The interviews revealed...
asked 5 hours ago -
An uncharged capacitor and a resistor are connected in series to
a source of emf. If...
asked 5 hours ago -
If assets are $540,000 and liabilities are $236,000 what is the
amount of owner’s equity?
asked 5 hours ago