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Q. What are the main factors determining the aggregate money demand?
Answer: Three major factors: the price level, interest rate and real national income. A increase in the interest rate causes each individual in the economy to reduce her demand for money. If the price level increases, individual firms and households will spend more money than before. When actual national income (GNP) raises the demand for money will rise.
Q. Explain how an increase in government spending would affect the DD-AA schedule in the short run. Answer: A raise in government spending will raise aggregate demand, which wi
Q. How did the international monetary system influence macroeconomic policy-making and performance during the interwar period (1918 - 1939)? Answer: Governments efficiently sus
Q. Explain how the German Bundesbank gained its low-inflation reputation. Answer: Essentially Germany's experience with hyperinflation in the 1920s and yet again aft
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Q. Why do governments prefer to avoid current account deficits that are too large? Answer: A current account debit may possibly pose no problem if the borrowed funds
Q. Evaluate the economic policies of Juan Peron, the husband of the famous Evita? Answer: Once Peron got the power in 1946 in Argentina the economy that at that time
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Q. Discuss the costs and benefits of FDI to host country? Benefits to host country Availability of scarce factors of production Improvement in the balance of payment Strengthen
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