What are the effects on aggregate outcomes

Assignment Help Macroeconomics

Reference no: EM133504340

Suppose that the economy is well described by the New-Keynesian with partial sticky prices. Assume that the ZLB on nominal interest rate is binding. In your answer below, keep in mind the consumers' and firms' optimaldecisions that give rise to the model and

explain how and why agents'decisions change.

Bank runs generate a large increase in spreads f_t in the economy. What are the effects on aggregate outcomes (??, ??, ??)? How does it compare to the case where the ZLB is not binding? Use diagram to support your answer
The Central bank, as lender of last resort, decides to inject large amounts of money into financialinstitutions. Analyse the transmission mechanismof this policy action as well as its effectson output and price level.

Reference no: EM133504340

Questions Cloud

Collaboration with families support of safe environments : Strategies for collaboration with families support of safe environments for children at home.

What will be the effects on real gdp : What will be the effects on real GDP, the interest rate, the exchange rate and exports? exchange rate and net exports exports of the domestic country

Discuss your reasons for selecting the model country : Discuss your reasons for selecting the model country for its best practices. Assess the performance indicators that led to the selection.

What is the medigap insurance program : What is the Medigap insurance program? Is the cost of the program fair considering the limits offered by the plan? Explain why. What is the Children's Health

What are the effects on aggregate outcomes : What are the effects on aggregate outcomes (??, ??, ??)? How does it compare to the case where the ZLB is not binding? Use diagram to support your answer

What are some strategies used in your program to collaborate : What are some strategies used in your program to collaborate with families and the community in support of healthy and safe environments for children.

What is the risk of a restrictive monetary policy : What is the risk of a restrictive monetary policy and What has the Fed had to do to "cool down" the economy? What impact is pursued by raising interest rates

Identify the appropriate statistical test of the difference : Identify the appropriate statistical test of the difference between the two groups in a dataset.

What is the amount of the average daily float : The cheque amounts and the collection delay for each cheque are shown below. Given this information, what is the amount of the average daily float?

User Account

All Pages