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Economics

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MACROECONOMICS;ECNM612;I.DEFINITIONS.Define10terms.Provideexampleswherepertinent.;Investment;ProducerPriceIndex;Monetarybase;Velocity;ConsumerPriceIndex;Pricedeflator;BusinessCycle;BankReserves;DemandDepositscouponinterestrate;TimeDeposits;Treasurysecurities(bonds);Assets;Liabilities;Policy;Equity;II.ESSAYQUESTIONS.AnswerBOTHquestions.Answerallpartstoeach;question.;1.a)WhatisGDP?ProvideatleasttwointerpretationsoftheconceptGDP.;b)ExplaintherelationshipbetweenAggregateDemandandGDP.;c)DevelopamathematicalmodelexplainingGDP,anddescribetheimpact;ofeachitscomponents.;d)WhatistheKeynesiantheoryofthemacroeconomy?UsetheAD/AS;modeltoexplain.;e)WhatisFiscalpolicy?;WhatarethegoalsofFiscalpolicy?;WhatarethetoolsofFiscalpolicy?;f)Explainhowcontractionaryfiscalpolicywouldbeimplemented.;Whatarethedifficultiesinimplementingthis?;g)Howeffectivedoyoubelievefiscalpolicytobe?;2.a)Whatismoney?What,today,comprisesmoney?;b)Whatismonetarytheory?ExplaintheEquationofExchange.;WhatistheroleofmoneyintheMacroeconomy?;c)WhatistheFederalReserve?Whatareitsimportantfunctions?;d)Whatismonetarypolicy?Whyarebanksthemeans(mechanism)by;whichmonetarypolicymustwork?;e)Whatarethegoalsofmonetarypolicy?;f)Whatarethetoolsofmonetarypolicy?Explaineach;g)Whatisthetargetvariable?;h)Giveanexampleofexpansionarymonetarypolicy,showingtheroleof;theFed,banks,and any other economic entity.

 

Paper#15006 | Written in 18-Jul-2015

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