Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Explain the effects of a permanent increase in the U.S. money supply in the short run and in the long run. Assume that the U.S. real national income is constant.
A raise in the nominal money supply increases the real money supply and lowering the interest rate in the short run. The money supply enhance is considered to maintain in the future therefore, it will influence the exchange rate expectations. This will make the predictable return on the euro more desirable and therefore the dollar depreciates. In the case of an enduring increase in the U.S. money supply then the dollar depreciates more than under a temporary increase in the money supply.
Currently in the long run prices will increase until the real money balances are the same as prior to the permanent increase in the money supply. Ever since the output level is given the U.S. interest rate which decreased prior to start to increase until it will move back to its original level.
The balance interest rate should be the same as its original long -run value. This raise in the interest rate should cause the dollar to appreciate against the euro after its sharp depreciation as a result of the permanent raise in the money supply. Thus a large depreciation is followed by an appreciation of the dollar. Ultimately the dollar depreciates in proportion to the increase in the price level which in turn enhance by the same proportion as the permanent increase in the money supply. Therefore money is neutral in the sense that it can't affect in the long run real variables for instance investment, output, and so on.
Q. The two deadweight triangles are the Production distortion and Consumption distortion losses. It is simple to understand why the Consumption distortion constitutes a loss for
i need to do term paper international economics related. the paper have to be empirical paper. Writing an Empirical Paper in APA Style 1- Title Page 2- Abstract 3- Introduction 4-
I am trying to complete this homework assignment and I need to use an example to describe and explain the classical theory of international trade, could you guys help me out?
Q. Why do we observe the Leontief paradox? Answer: There are several possible answers that they may be categorized into three groups. One would argue that the theory or model
Explain the Global Firms and the Borderless Global Economy
graph
how is exchange rate determined?
Q. Write an essay on the importance of a sound banking system in developing countries. Answer: Students must describe the phenomena of moral hazard as a part of their answer,
describe the U.S role in the world economy
Summarized the basic tenets of the arguments in this case
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd