Q: As part of its response to the global financial crisis, the
As part of its response to the global financial crisis, the Fed lowered the federal funds rate target to nearly zero by December 2008, a considerable easing of monetary policy. However, survey-based m...
See AnswerQ: Suppose the statistical office of a country does a poor job of
Suppose the statistical office of a country does a poor job of measuring inflation and reports an annualized inflation rate of 4% for a few months, while the true increase in the price level has been...
See AnswerQ: Immediately after the central bank of New Zealand adopted inflation targeting in
Immediately after the central bank of New Zealand adopted inflation targeting in 1989, economic growth was low and unemployment increased for some time (until 1992), but later, economic growth resumed...
See AnswerQ: Assume the following production function: Yt = AK0.4 t
Assume the following production function: Yt = AK0.4 t L0.6 t . The capital stock and output are measured in trillions of dollars, and the labor stock is measured in millions of people. a) Using the...
See AnswerQ: The table below shows the inflation rate and the level of real
The table below shows the inflation rate and the level of real GDP under the anti-inflation policy known as the Volcker disinflation for two periods in the early 1980s. a) Use the data in the table...
See AnswerQ: The graph on the next page is based on quarterly data on
The graph on the next page is based on quarterly data on unemployment and real output growth in the United States between 2006 (q1) and 2013 (q2). Are these data consistent with the real business cycl...
See AnswerQ: The Bureau of Labor Statistics (BLS) tracks the numbers of
The Bureau of Labor Statistics (BLS) tracks the numbers of workers who are employed part-time for economic reasons. The number typically increases sharply at the beginnings of recessions and gradually...
See AnswerQ: A measure of real interest rates can be approximated by the Treasury
A measure of real interest rates can be approximated by the Treasury Inflation Indexed Security, or TIIS. Go to the St. Louis Federal Reserve FRED database, and find data on the five year TIIS (FII5)...
See AnswerQ: Using a graphical representation of the new Keynesian model, describe the
Using a graphical representation of the new Keynesian model, describe the effects of an unanticipated negative demand shock (label this equilibrium as point 2). Compare these effects to those of an an...
See AnswerQ: Suppose consumer confidence surges, making consumers more willing to spend.
Suppose consumer confidence surges, making consumers more willing to spend. Use the New Keynesian model to describe the effects on output and inflation depending on whether the surge in consumers’ con...
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