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Monetary Policy

Macroeconomic Analysis: Economic Indicators

Interpreting Macroeconomic Indicators Analyze several indicators of the macroeconomic conditions in an economy, such as interest rates, income, and other indicators such as CPI, inventory levels, wage rates, consumer confidence, etc. You may chose from these indicators: Economic growth Unemployment Inflation


1. Describe the three tools of monetary policy. 2. Find an article that shows a change in the US monetary policy. 3. State the objective of this monetary policy. 4. Discuss the expected outcomes of that policy. 5. Summarize how this monetary policy has affected (is affecting) the economy through change in the mon

resent worth, future worth, and annual worth

a) When the salvage value is in year 4, and b) When the salvage value is in year 5. Machine 1 Machine 2 Machine 3 Initial Cost $800,000 $650,000 $575,000 Annual Operating Cost $50,000 $90,000 $105,000 Salvage value $40,000 $32,500 $28,750 Hint: A cash flo

Monetary Policy

Read the most recent report by the Federal Reserve Chairman. * What is monetary policy * Tools of monetary policy * Issues in evaluation of monetary policy

Budget deficits and economic growth

Economists generally agree that high budget deficits today will reduce the growth rate of the economy in the future. Why? Do the reasons for the high budget deficit matter? In other words, does it matter whether the deficit is caused by lower taxes, increased defense spending, more job-training programs, and so on? In your analy

Oligopolies and monopolistic competition are discussed.

In a 2009 Newsweek article, The 50 Most Powerful People List, there are 3 bankers who are listed as the 4th, 5th, and 6th most powerful people in the world. Read the following article on the "Economic Triumvirate": Downloadable pdf version: The Global Elite: Economic Triumvirate, or go to

Classical and Keynesian schools of economics are compared.

Question One Contrast the revenue sources of state and local government vs. the federal government. What are the primary sources of funding for the two levels of government? Contrast the allocation of spending for state and local government vs. the federal government. Why do you think the two levels of government

Problem scenario

Empirical evidence suggests that individuals who invest n higher education benefit from a substantial 'education premium', i.e. their future salaries are on average higher than those of individuals with only a high school diploma. (a) What are the costs of higher education? What method would you use to assign a monetary valu

describe the state of the economy

I need some assistance, based on current news, please describe the state of the economy, government fiscal policy and Fedâ??s monetary policy by answering the following questions. Please provide citation where possible 1.What stage of the business cycle is the economy going through? Give several major econ indicators, for ex

Money Multiplier

What is the Money Multiplier? How does the Federal Reserve System shape the Monetary Policy?

Monetary Policy and Interest Rates

Most economists consider interest rates to be the principal instrument by which monetary policy affects economic activity. However, significant changes in the structure of financial markets have altered the interest rate channel. Do you agree or disagree with this point of view? 419 words, no references

monetary policy :sample question

For the past 3 years a major department store chain has averaged approximately $10 billion in long-term debt. Their debt is in the form of bonds that have been sold to investment funds and the public (If you are not sure what a corporate bond is look it up on the internet). For the sake of argument, let us assume that either n

U.S. expansionary monetary policy is expressed

Please help with the following problem at least 200 words. Explain the effect of U.S. expansionary monetary policy on the U.S. economy if exchange rates are flexible. How would the effectiveness of an expansionary monetary policy change if exchange rates were fixed?

The Role of Money and the Aggregate Model of the Macro Economy

Q1. Define money and list the functions it performs. Q2. Assume the government cuts its purchases by $120 billion. As a result, the budget deficit is reduced by $40 billion, private domestic saving decreases by $10 billion, disposable personal income decreases by $80 billion and the trade deficit is reduced by $15 billion. By

Short Answer Questions

Why would the Federal Reserve want to control the size of the money supply? Compare active and passive approaches to the economic policy. Which approach would seek to shrink the size of the government? What determines the quantity demanded of money? What three control mechanisms does the Federal Reserve have at its d

Trouble understanding Monetary Policy

-If the Fed cuts the quantity of money, explain how each of the following items change. a) Business' purchases of new capital equipment. b) Households' purchases of new cars and houses. c) Foreign purchases of U.S.-made goods and services. d) Americans' purchases of Canadian-made goods and services. -What is th

What's wrong with the following statement: If two people buy an airplane ticket from Detroit to San Francisco for $450 round-trip, the opportunity cost of that flight is the same for both of them.

"What's wrong with the following statement: If two people buy an airplane ticket from Detroit to San Francisco for $450 round-trip, the opportunity cost of that flight is the same for both of them." In the case where there is no explicit accounting or monetary cost (price) attached to a course of action, or the explicit acc

Monetary Stimulus

1. Go to the St. Louis Fed's web site and look at the graph of target federal funds rates over the last few years: Notice that from January 2001 until June 2003, the Fed lowered the target federal funds rate in steps from 6.5% all the way down to 1% and left it ther

Comparisons, Contrasts and Conclusions

Please let me know if you can help with the following: This post asks about comparing and contrasting two specific people, events, or organizations. No personal, political or religious topics. Topics should be focused on business, workplace and career communications. You may write about interests such as sports, music

Monetary Policy Report to Congress Humphrey-Hawkins Report

I need to answer these questions related to the Monetary Policy Report to Congress? Characterize the state of the economy from the report? Is the Fed more concerned about inflation or possibility of recession? What is the stated direction of recent monetary policy? What policy actions has the Fed taken to confirm th

Fiscal and Monetary Policy

1. There are several tools the Fed uses to implement monetary policy. A) Briefly describe these tools. 1) Reserve Requirement-requires banks to hold a fraction of deposits. 2) Discount Rate-the amount the Feds charge banks that borrow from them. 3) Open Market Operations- the buying and selling of U.S. government bonds.

goals of monetary policy in the United States

Two goals of monetary policy in the United States are price stability and full employment. Are these goals always consistent with each other? Explain with the help of the appropriate graph(s).

Contractionary and expansionary monetary policy

What is the difference between contractionary and expansionary monetary policy? What are the pros and cons of using expansionary and contractionary monetary policy tools under the following scenarios; depression, recession, and robust economic growth? Which do you think is more appropriate today?

Monetary Policy: money, credit, the Federal Reserve, interest rates

Money and interest rates are important to individuals and businesses making decisions to finance purchases. The following articles assess conditions for finance purchases and important aspects of monetary policy. Tom Woodruff has written an interesting and to-the-point article, "A borrower's guide to forecasting interest rat


Write a brief history of the FEDERAL RESERVE system and delineate the role the Fed has in designing and implementing U.S. Monetary policy. Identify the THREE tools the FED has available to influence Money Supply and interest rates. 350 words

Consumer equilibrium Marginal Rate of Substituion

QUESTION 1 (a) Using an appropriate diagram, explain clearly why a consumer must be in equilibrium when the marginal rate of substitution is equal to the ratio of the prices of the goods consumed. (b) Use an appropriate diagram; explain how indifference curve analysis can be used to derive a demand curve. QUESTION 2

Trends in Currency Circulation

3. The table below shows the components of M1 and M2 in billions of dollars for the month of December in the years 1995 to 2004 as published in the 2005 Economic Report of the President. Complete the table by calculating M1, M2, currency in circulation as a percentage of M1, and currency in circulation as a percentage of M2. Wh