How can the central bank and the government end with hyperinflations?
How can the central bank and the government end with hyperinflations?
5. Can the government and the central bank work together to prevent crowding out effect? Use an IS-LM diagram to explain the steps. What should be done by the government and the central bank? Explain your answer.
If the government finances its spending by selling bonds to the central bank, the monetary base will ________ and the money supply will ________. 1)increase; increase 2)increase; decrease 3)decrease; decrease 4)not change; not change can you please explain why the answer is A?
Monitoring Central Bank Intervention 1)How can your business be affected if the Fed attempts to strengthen the dollar in the for-eign exchange market? 2)If the Fed decides to weaken the dollar, how will your business be affected? 3)How can indirect central bank intervention affect your business even if there is no impact on exchange rates? Accessing Central Bank Information Go to the Web site link for the central bank in your target country. Determine whether this central bank intervenes to...
The FED (Central Bank in the USA) is watching the actions of the federal government and believes that federal government spending will increase next quarter which will lead to future rates of inflation greater than 3 percent. Using the Money Supply Model explain how the FED will use its TOOLS and affect inflation. Define the key macro terms and the Money Supply Model in business friendly terms. Businesses are concerned about both inflation and higher interests. Explain why they are...
Assume that both the U.S and Europe experience high unemployment. How can the U.S central bank attempt to adjust the dollar value to reduce this problem? Is the European central bank likely to go along with the US central bank's strategy or retaliate? Why? Why are quoted soot rates very similar across all banks?
3b. Evaluate/Interpret the followings: (10 marks) (0) The Federal government (central bank) can shift the aggregate demand curve, what will happen to te demand and demand curve shift, if interest rate decrease and if interest rate increase.( support with diagram) (2 marks) (i) Compare "The multiplier effect" and the "crowding-out effeet" (2 marks) (ii) Compare "The misery index" and "Phillips curve" (2 marks)
If the central bank wants to discourage the government from deficit spending, what options are open it? What are the side effects of such option?
How The Central Bank of Republic of Turkey can change the interest rates in the economy without changing its policy rate, overnight landing rate and late window rate?
In March 2020, the European Central Bank, the Bank of Canada, and the Federal Reserve (and other central banks) began to consider measures to address the economic consequences of the Covid-19 virus. These measures might include A. buying government securities, increasing the bank rate, and relaxing regulations on bank loan and reserve requirements B. selling government securities, increasing the bank rate, and relaxing regulations on bank loan and reserve requirements C. buying government securities, decreasing the bank rate, and relaxing...
1.Suppose the Bank of Canada sells government bonds. Use a graph of the money market to show what this does to the value of money. (6 marks) 2.Using separate graphs, demonstrate what happens to the money supply, money demand, the value of money, and the price level if: a. the Bank of Canada increases the money supply. b. people decide to demand less money at each value of money. 3.Economists agree that increases in the money supply growth rate increases...