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Why did this huge decline in stock prices have such a relatively small effect on the US economy in 2001-02 relative to 1929-32?
In 2002, the market did not decline more than 5% on any given day, but the net reduction was about the same. Which drop was least harmful to the economy?
Do you think that the Fed decision to hold the funds rate below equilibrium will cause higher inflation at the peak of the next business cycle?
To what extent do you think a stronger dollar is likely to cause cyclical downturns in the future?
Why do you think fluctuations in that category will dominate cyclical fluctuations in the overall economy?
The next time the US economy returns to full employment, what factors will determine how much longer it will take for the next recession to develop?
Explain whether this result is due to a set of odd coincidences, or whether the improved methods of inventory control actually caused bigger fluctuations.
Why can the declines be explained entirely by the reduction in disposable income, or are they also related to credit conditions?
What does that say about the impact of changes in stock prices on the demand for housing?
What factors caused the frequency of business cycles in the US to decline, and what factors caused their frequency in Europe and Japan to increase?
What effect would this eventually have on the Argentine peso even if that country had a balanced budget, a currency tied to the dollar and backed by gold.
Assume that the value of the currency of country J rises by 10% one year. How much would the currency rise or fall in the following year?
Why do you think the Japanese government permitted the to become so overvalued in first half of the 1990s? Do you think they could have done anything about it?
Explain how the decision to float the £ in Britain also reduced the rate of inflation. (Hint: what happened to productivity?)
What factors would determine whether your firm should shut down its plants in the US and relocate to Mexico, or continue to produce in the US?
Shortly after World War II, the US occupying forces set the value of the Dmark. Why was an undervalued currency good for Germany and Japan, but not for the US?
Why was failing to devalue the pound the wrong strategy for the UK in 1968, while the decision to devalue the dollar the wrong strategy for the US in 1978?
Why was he wrong economically, and why was he wrong politically? (After being defeated by Ted Heath in 1970, Wilson returned as prime minister in 1974.)
The dollar declined sharply in 1973-4 and 1977-8, and those declines were accompanied. What explains the different behavior of inflation in those two periods?
Why is the US better or worse off based on the Japanese decision to hold import prices constant? Is Japan better or worse off?
Explain why energy shocks have occurred in the past and the price of imported oil has soared, both the US trade balance and value of the dollar have increased.
The Export-Import Bank helps Boeing by providing various subsides. How would you determine whether the American taxpayers are getting their money's worth?
What factors would you consider when determining whether an investment in sub-Saharan Africa would be profitable for your company?
India is further down road toward capitalism than China. Why do you think so many international firms prefer to invest in China rather than India?
Under what conditions would you expect the recent rapid growth rates in the Indian subcontinent and south Asia to continue.