Policy pro-cyclical or anti-cyclical

Assignment Help Business Economics

Reference no: EM131085952

If a central bank adopts a policy of fixing an interest rate at a constant value and the economy enters a recession, what would happen to money supply and demand? Explain with a graph. Is this policy pro-cyclical or anti-cyclical?

Reference no: EM131085952

Questions Cloud

Find the demand functions : Consider an individual with utility of the form: U(x.y)=400+x^ay^b where (a+b) = 1. the price of good x is px and the price of good y is py. The individual faces a budget constraint of I (income).

Find real federal funds rate recommended by taylor rule : If the equilibrium real fed funds rate and the inflation target are 2%, actual inflation is 3%, and the output gap is –1%, find the real federal funds rate recommended by the Taylor Rule.

Antitrust legislation in the united states : Defend or critique the key provisions of the antitrust legislation in the United States. Analyze the major ways in which quality issues in health care affect antitrust healthcare policy. Provide at least one (1) example of antitrust laws in action..

Question regarding the function of wage : a) Derive the consumer's budget constraint and its choice variables (ie. the total amount of hours worked and leisure as a function of wage) b) Derive the consumer's marginal rate of substitution dC/dR

Policy pro-cyclical or anti-cyclical : If a central bank adopts a policy of fixing an interest rate at a constant value and the economy enters a recession, what would happen to money supply and demand? Explain with a graph. Is this policy pro-cyclical or anti-cyclical?

Complete graph with directed edges : Assignment 2. Recall that a tournament is a complete graph with directed edges (so we think of the vertices as players in a tournament in which every pair of players play each other, with a directed edge (u, v) if u beats v). Fix a positive intege..

Purchase of government bonds : Analyse the effect of an expansionary monetary policy (purchase of government bonds) on the equilibrium interest rate an income in a liquidity trap using the IS-LM model (closed economy and fixed prices). Analyse and discuss.

Write a subprogram with the following specifications : Write a main program which calls this subprogram and displays the generated numbers numerically or. optionally. graphically as a histogram

Generate revenues sufficiently high in relation to costs : The USPS operates a network of more than 31,000 post offices. The majority of these post offices do not generate revenues sufficiently high in relation to costs to justify keeping them in operation. If the USPS were truly a private firm, many of thes..

User Account

All Pages