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Review of Policy Perspectives Why might an active policy approach be more politically popular than a passive approach, especially during a recession?
What variable naturally adjusts in the labor market, shifting the short-run aggregate supply curve to restore unemployment to the natural rate?
Compare what you read in the article to what you learned about the Federal Reserve in the chapter.
What does the article say about whether the Fed considers international economic conditions when setting U.S. monetary policy?
What will happen to money demand over time? If the Fed leaves the money supply unchanged, what will happen to the interest rate over time?
What basic assumption about the velocity of money transforms. What happens to the price level in the short run in each of these three situations?
What is the value of a forward contract in terms of the current stock price, the interest rate, the delivery time, and the delivery price
Contrast the varying assistance programs for the poor in the United States, addressing how benefits are allocated, funded, and controlled.
Choose one article from the past two years about your home country and one article. Compare and contrast attitudes toward balanced national budgets.
Select Global Issues in Context. In the Basic Search box at the top of the page. Why was the author not concerned about the high U.S. national debt?
What is the new level of gross national debt? What happens to the level of debt held by the public as a percentage of GDP?
How have government outlays as a percent of GDP changed in the industrial countries depicted between 1992 and 2011?
Explain why Robert Barro argues that if parents are concerned enough about the future welfare of their children, the effects of deficit spending.
we've seen that the government can increase GDP in the short run by running a budget deficit. What are some long-term effects of deficit spending?
Why are the Social Security and Medicare programs headed for trouble? When will the trouble begin? What solutions have been proposed?
Why did the federal budget go from a huge deficit in 1992 to a surplus in 1998? Explain the factors that contributed to the turnaround.
Is it true that international trade tends to equalize prices of goods and services around the world?
Is it possible for U.S. federal budget deficits to crowd out investment spending. How could German or British investment be hurt by large U.S. budget deficits?
If Dell agrees to purchase 3 million hard drives at price P*=$30.2/unit and renegotiates to only purchase for $26.8/unit, how much Dell profits?
Explain the differences among an annually balanced budget, a cyclically balanced budget, and functional finance. How does each affect economic fluctuations?
Why does the budget require a forecast of the economy? Under what circumstances would actual government spending and tax revenue fail to match the budget?
What is the size of the government deficit (or surplus) at this output level? What is the size of net exports at the level of real GDP demanded?
Is the same true of lowering the discount rate? What would happen if the Fed bought U.S. bonds from, or sold them to, the banking system?
Though not discussed in the text, Fannie Mae and Freddie Mac played important roles in 2008 financial crisis. What does the Overview says about these agencies?
Bank Deregulation Some economists argue that deregulating the interest rates that could be paid on deposits. On what basis do economists make such an argument?