Answers
Most of the government used the full employment policies to maintain the economic growth and development. This can be attained through high demand of foreign customers. The export become cheap and import become expensive. So most of the domestic firms increase their output level and increase the export.
.
This can be represented through AA-DD model. This model explains the simultaneous equilibrium in goods market, money market and foreign market. Both fiscal and monetary policy shows the economic development and the growth rate. If the government increased the level of expenditure, then the aggregate demand will increase and this will shift the AA curve to right. AA cure shows the simultaneous equilibrium in goods and money market.
The rise in government expenditure will raise the output level and reduce the price level. Here the exchange rate increased. But this rise in exchange rate will reduce the economic growth and make the import cheaper. On the other hand, the expansionary monetary policy will increase the money supply and reduce the interest rate. This will expand the investment level and increase the economic growth rate.
The simultaneous implementation of fiscal policy and monetary policy will shift the AA curve to right. A A Exchange rate E1 EO A' D A YO Y1 Output This shift in AA curve makes a negative impact in the economy through rising exchange rate. This appreciation will retard the economic development and growth. The rise in exchange rate reduces the price level. If there is fiscal expansion the level of output and domestic prices will increase at nominal exchange rate.
Here the price of imports fall down and money market come under equilibrium. The nominal exchange reduces the import prices. Through fiscal and monetary expansion the markets come under equilibrium with nominal exchange rate.
Similar Solved Questions
1 answer
Constants | Periodic Table Part B A turntable rotates counterclockwise at 84 0 rpm At what...
Constants | Periodic Table Part B A turntable rotates counterclockwise at 84 0 rpm At what final angle is the turntable at 8 55 s if the turntable starts from an initial angle 0640 rad ? Give your answer in radians View Available Hint(s) Hint 1. Setting Up the Problem Ta Submit Previous Answers Redu...
1 answer
Question 2 (30 marks) Unit 9 - Statement of Cash Flow As the accountant for Awesome...
Question 2 (30 marks) Unit 9 - Statement of Cash Flow As the accountant for Awesome Foods Incorporated, you are responsible for preparing the cash flow statement. You have decided to prepare the statement using the indirect method and have gathered the following data from the accounting records: Pri...
1 answer
Which measurement of money supply are checkable deposits included in? - only M1 BUT NOT M2...
Which measurement of money supply are checkable deposits included in? - only M1 BUT NOT M2 -ONLY m2 but not m1 -neither m1 nor m2 - both m1 and m2...
1 answer
1. A monopolist operates in 2 different markets (selling the same product but different quantities Q1...
1. A monopolist operates in 2 different markets (selling the same product but different quantities Q1 and Q2), there are 2 marginal revenue functions below in market 1 and 2. Please provide the aggregate marginal revenue function which is the horizontal summation of these marginal revenue functions....
1 answer
It is believed that interstitial diffusion is faster than vacancy diffusion. Can you show this by...
It is believed that interstitial diffusion is faster than vacancy diffusion. Can you show this by comparing the values of diffusion coefficients of a pair of cases (one values for each type of diffusion) from Table 5.2......(5 points)...
1 answer
Which of the following is a negative consequence of spanking as a form of discipline? O...
Which of the following is a negative consequence of spanking as a form of discipline? O A. Lower levels of aggression OB. Withdrawal from both parents OC. Modeling inflicting of pain to get what one wants OD. Emotional flattening Reset Selection...
1 answer
ULL FULL SON PRINTER VERSION BACK NEXT Exercise 17-03 a1-a2, b1-b2 Eco Fabrics has budgeted overhead...
ULL FULL SON PRINTER VERSION BACK NEXT Exercise 17-03 a1-a2, b1-b2 Eco Fabrics has budgeted overhead costs of $1,134,000. It has allocated overhead on a plantwide basis tots two products (wool and cotton) using direct labor hours which are estimated to be 540,000 for the current year. The company ha...
1 answer
E Styes Styles 1) Imagine that you place the Bull's Eye on the floor, and then...
E Styes Styles 1) Imagine that you place the Bull's Eye on the floor, and then drop a small ball from a 2-meter height (say, extending your arm above your head), aiming at the center of the target. The ball, hitting the carbon paper, will leave a mark on the bottom Bull's Bye sheet. You repe...
1 answer
Use the t-distribution to find a confidence interval for a difference in means μ 1 -...
Use the t-distribution to find a confidence interval for a difference in means μ 1 - μ 2 given the relevant sample results. Give the best estimate for μ 1 - μ 2, the margin of error, and the confidence interval. Assume the results come from random samples from populations that are approx...
1 answer
Use the Laplace transform and the procedure outlined in Example 10 to solve the given boundary-value...
Use the Laplace transform and the procedure outlined in Example 10 to solve the given boundary-value problem. y"2y'y 0 y(O) 6, y(1)6 Need Help?Read It Talk to a Tutor Submit Answer Save ProgressPractice Another Version...
1 answer
Keep-or-Drop Decision Petoskey Company produces three products: Alanson, Boyne, and Conway. A segmented income statement, with...
Keep-or-Drop Decision Petoskey Company produces three products: Alanson, Boyne, and Conway. A segmented income statement, with amounts given in thousands, follows: Alanson Boyne Conway Total Sales revenue $1,280 $185 $300 $1,765 Less: Variable expenses 1,115 45 225 1,385 Contribution...
1 answer
Please show all your work and submit one report as a team. To obtain any credit...
Please show all your work and submit one report as a team. To obtain any credit you must show how you obtained the answer even if you used a calculator to actu ally compute it. 1. The ranger's office at the Grand Canyon provides mule trips to people. People in- terested in mule trips wait for a ...
1 answer
What is the domain and range of #f(x) = 1/(x-2) #?
What is the domain and range of #f(x) = 1/(x-2) #?...
1 answer
Identify the test statistic Identify the p-value Ma M e Do Homework Corpu Kokol X Coved...
Identify the test statistic Identify the p-value Ma M e Do Homework Corpu Kokol X Coved Testing Claims About PXW Agent experimento + C mathx.com/Student/PlayerHomework aspx?homeworkld=546672332&questionid=27&flushed=false&cid=55976728back-DoAssignments.aspx?view=homew.. MATH1127 (21427) ...
1 answer
I need help with this question as soon as possible. Saved Question 1 (10 points) Winslow...
I need help with this question as soon as possible. Saved Question 1 (10 points) Winslow Corporation opened in August 2018 and completed the following transactions during August: a. Cash of $25,000 and equipment of $36,000 was invested in the company in exchange for common shares. b. Paid office ...
1 answer
Use the Alternating Series Remainder Theorem to determine the smallest number of terms required to approximate...
Use the Alternating Series Remainder Theorem to determine the smallest number of terms required to approximate the sum of the series with an error of less than 0.00 (-1) + 1 11 5 X...
1 answer
Can someone help me please and clearly show step by step how to get the answer....
Can someone help me please and clearly show step by step how to get the answer. I can't figure it out. *For each of the following reactions, 16.0 g of each reactant is present initially. CS2(g)+3O2(g)→CO2(g)+2SO2(g) -Calculate the grams of product in parentheses that would be produced. (CO...
1 answer
Land Corporation reported the following: Common Stock, $5.00 par, 208,000 shares authorized, 162,000 shares issued Paid...
Land Corporation reported the following: Common Stock, $5.00 par, 208,000 shares authorized, 162,000 shares issued Paid in Capital in Excess of Par—Common Retained Earnings Total Stockholders' Equity $810,000 200,000 215,000 $1,225,000 Which of the following is included in the entry to rec...