Indicate whether true or false and provide explanation An economy subject to large and sustained structural shocks will have a higher structural unemployment rate. It is far easier to generate higher inflation if the central bank maintains a loose monetary policy when this is the case. Real interest rates have been lower than growth for […]
Tag Archives: Keynesian
Discuss what is meant by the Classical belief that the economy is self-correcting.
PRINCIPLES OF MACROECONOMICS QUIZ 2 – COVERING CHAPTERS 5-7 DUE BACK ON SEPTEMBER 28TH INSTRUCTIONS:Show your work / explain your answers or you will lose credit. Discuss what is meant by the Classical belief that the economy is self-correcting. When did this theory break apart?What might be some Keynesian prescriptions to get the economy out […]
Discuss the extent to which the use of demand side policies (fiscal policy and monetary policy) during the Great Recession of 2008 has been successful in restoring economic growth and reducing unemployment
Macroeconomic analysis deals with the crucial issue of government involvement in the operation of “free market economy.” The Keynesian model suggests that it is the responsibility of the government to help to stabilize the economy. Stabilization policies (demand-side and supply-side policies) are undertaken by the federal government to counteract business cycle fluctuations and prevent high […]
