ZuoTi.Pro
Question

8. Briefly discuss three reasons the Bank of Canada has not chosen a zero inflation target. (6 mar
business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Ansuer of Cairoda h not choo fox r lations of coroda s used toevodRate T inftatt on m e conadian economy hu A ocs of Credit bresolved Such on aippratsal Ps to histoy achteve pace cf mone fary exponstm bot

0 0
Add a comment
Know the answer?
Add Answer to:
8. Briefly discuss three reasons the Bank of Canada has not chosen a zero inflation target....
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • c) 3 marks The Bank of Canada currently has a monetary policy target of 2% inflation....

    c) 3 marks The Bank of Canada currently has a monetary policy target of 2% inflation. Suppose that the Federal Reserve in the US holds inflation at 3% for a sustained period of time. Would the Canadian dollar appreciate or depreciate against the US dollar over time? What would be the effect on the real exchange rate? d) 3 marks Consider a small open economy in equilibrium. What would be the effects of a protectionist trade policy in the short...

  • (a) If inflation has economic costs, why don’t central banks have a target of zero inflation?...

    (a) If inflation has economic costs, why don’t central banks have a target of zero inflation? Following the GFC in 2007-08, a number of economists have called for central banks to raise their inflation targets to 4 to 5 percent as a way of reducing the risk of hitting the zero lower bound (ZLB). (b) How does a higher inflation target help to reduce the risk to a central bank of hitting the ZLB? (Hint: Use the Fisher effect.) (c)...

  • What is a monetary policy inflation target, and what is the specific target for Australia used...

    What is a monetary policy inflation target, and what is the specific target for Australia used by the Reserve Bank of Australia? Discuss one advantage and one disadvantage of inflation targeting, and briefly provide for an example for each.

  • Suppose that the Bank of Canada wishes to reduce the rate of inflation from its current...

    Suppose that the Bank of Canada wishes to reduce the rate of inflation from its current 8% to 4% and the bank is prepared to accept a sacrifice ratio of 2. If the potential GDP is $800 billion, then this would imply that the bank is prepared to accept a decline of annual real GDP of O A. $67.2 billion. OB. $70.0 billion. OC. $57.6 billion. OD. $64.0 billion. O E. $60.8 billion

  • Critically and briefly describe the following conventional monetary policy tools and policy target and their relative...

    Critically and briefly describe the following conventional monetary policy tools and policy target and their relative effectiveness in controlling business cycle fluctuations such as state of recession and/or state of inflation. How do they operate during recession and inflation? Draw AD-AS diagram of macroeconomics model to illustrate your explanation in words. Reserve Requirements Discount Rate Open Market Operations Federal Fund Rate (Policy target) Distinguish between budget deficit and public debt with an example from actual data from the US government...

  • A central bank has a new head, who decides to raise the target inflation rate from...

    A central bank has a new head, who decides to raise the target inflation rate from 2 to 3 percent. Using a graph of the dynamic AD-AS model, show the effect of this change. What happens to the nominal interest rate immediately after the policy change and in the long run? Explain

  • Suppose the inflation rate in Canada is 2% and is expected to remain 2% for the...

    Suppose the inflation rate in Canada is 2% and is expected to remain 2% for the upcoming year. Bank deposits pay 3% annual interest rate in Canada. Suppose you deposit $100 at a bank. a. In nominal terms, your savings will grow to _$ next year. b. Due to inflation, the real value of your savings account next year is c. What is the real rate of return on your savings? A firm is considering buying a machine that will...

  • List three costs to the society that results from the inflation Giving reasons, explain what has...

    List three costs to the society that results from the inflation Giving reasons, explain what has happened to Kuwait's net export as the result of Coronavirus pandemic? Giving reasons, explain what has happened to Kuwait's how net capital outflow as the result of Coronavirus pandemic? What is the nature of the relationship between saving, domestic investment, and net capital outflow?

  • As a University student, discuss three major reasons why it is important to know your morals...

    As a University student, discuss three major reasons why it is important to know your morals and values as you pursue your academic life and prepare for your chosen professional path.

  • 1) Under inflation targeting, a central bank must pursue policies that Select one: A. keep the...

    1) Under inflation targeting, a central bank must pursue policies that Select one: A. keep the inflation rate within a specific target range. B. keep the inflation rate at a target value of zero. C. keep the inflation rate above some specific target value. D. lower the inflation rate, provided this can be done without raising the unemployment rate above a specified target value. 2) If the desired intermediate target is an interest rate, then the preferred operating target will...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT