Components of gdp, Macroeconomics

Assignment Help:

Write a 4-5 page paper, double-spaced, Arial 12pt font, 1 inch margins all around (top, bottom, left, and right) that addresses the following news event summarized below

In a totally unexpected move, China's central bank announced that commercial banks must give them an additional 0.5% of deposits. But it was also done to help combat, meaning counteract the easing of monetary policy here in the US. And to help keep the Chinese currency from appreciating (rising) too much that it will slow down China's economic growth.

FYI, the US and other world economies have been pushing China to let their currency rise. The fear by those economies and the US is that a continuing low-valued Chinese currency will make economic recovery tougher. So they'd like China to allow their currency to rise, slowing their economy down so the rest of the world can recover faster. However, China's reluctance to let their currency rise is something that's frustrated other world economies.

China has said the Fed's recent easing monetary policy is pretty much a "de facto devaluation of the dollar." In other words, without officially devaluing the dollar, the Fed has taken action that basically does just that. So in response, China has taken steps to tighten their monetary policy.

In your papers, please address the following questions. And remember, your grade will be based upon the depth of your analysis!

1.       Exactly how will China's announcement saying banks need to hold more deposits with the central bank effect the balance sheets of both the banks and the Chinese Central Bank. This includes explaining the kind of reserves banks hold and which specific one(s) are involved here

2.       Explain the economic impact by the People's Central Bank on China's economy. How do you think it'll impact GDP and specifically why? Make sure you discuss the various components of GDP. And which one(s) you think will be effected and how. Also discuss the effect on equilbrium and aggregate expenses. Make sure you explain your reason(s) why.

3.       What impact will the Chinese Central Bank's decision have on the money multiplier? How will the spending and investment multipliers be effected? And what impact, if any, would you expect on MPS, MPC, APC, and APS? FYI, don't forget to explain what each of these is.

4.       How will China's announcement effect interest rates in China? And what impact will it have on aggregate demand and supply? Make sure you clearly explain how demand and/or supply will be effected. This way I can tell if you feel one or both are effected, and exactly how so.

Important Notes:

1.  Make sure you limit your paper's focus to the quesitions being asked

2.  No outside resources may be used! You are not allowed to do things such as surf the net, use other books & resources, etc.

3.  This is strictly individual work, not group! You are not permitted to work with others on this. You need to do your own work or it's considered cheating!

4.  Bullets cannot be used! And graphs do not count towards the 4-5 pages!

5.  No outside research! This means you must limit yourself to the news event here. So you cannot do more research into the event and/or China policy. You are limited to the info in the news event itself!

6.  Do not include the questions in your paper! Your entire paper must be devoted entirely to answering the specific questions I'm asking.

7.  Your entire paper must be written in paragraph form! So write it as if you were doing an English essay.

8.  No quoting the book or other class materials! Everything must be in your own words. And because you are not permitted to quote others or do outside research, you won't need a page or section for citations. Your entire paper will be paragraphs answering my questions.


Related Discussions:- Components of gdp

Filbert and lychee have convex, Filbert and Lychee have convex indifference...

Filbert and Lychee have convex indifference curves. Note Filbert is indifferent between baskets (3, 2) and (4, 1)--these are x, y coordinates. Lychee is indifferent between baskets

Licensed drivers revealed the following number of speeding, A sample of 2,0...

A sample of 2,000 licensed drivers revealed the following number of speeding violations. 0 violations for 1,910 drivers. 1 Violations for 46 drivers. 2 violations for 18 drivers. 3

Advantages might a socialist, What advantages might a socialist system have...

What advantages might a socialist system have in responding to the needs of people struck by an emergency situation like the earthquake that occurred in Haiti in January, 2010?

Makers respond to the crisis monetary policy, Did monetary policy contribut...

Did monetary policy contribute to the economic crisis of 2008? Why or why not? How did monetary policy makers respond to the crisis? Has their response created an environment for f

Neo-classical thinking on growth, Neo-classical thinking on growth: Neo...

Neo-classical thinking on growth: Neo-classical  thinking  on  growth  is  owed  to  the Robert  Solow  whose  exogenous  growth models in the of the mid-20th century remained

Mundel fleming model., The mundelfleming model takes the world interst rate...

The mundelfleming model takes the world interst rate r* as anexogenous variable.Let,consider what happen when this variable changes.a,what maight cause the world interest rate tori

Decrease the nominal deficit, Which of the following will decrease the nomi...

Which of the following will decrease the nominal deficit? A. An increase in taxes. B. An increase in the debt. C. An increase in government expenditures. D. An increase in interest

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd