Explain impact of exchange rate policies on domestic economy
Problem
Explain the impact of exchange rate policies on the domestic economy and international trade.
Foreign exchange rate policies: floating, fixed, and managed impacts on domestic and international trade.
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What happens to Carlo's lifetime income and consumption when we introduce a real interest rate of 5%.
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Suggest at least three possible negative economic effects of a budget deficit and three possible economic benefits of a budget deficit.
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What is the aggregate expenditure (AE) function? Using algebra, find equilibrium GDP (i.e. equilibrium national income Y).
What is the government's role in developing fiscal policy? What role/s fiscal policy plays in achieving government objectives?
What other steps do you believe would help revive the Australian economy besides the monetary policy instruments?
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