If the economy is in recession, explain what advice you would give the President, if you were a monetarist economist. What if you were a Keynesian?
If you were a monetarist, you would tell the President not to intervene in the economy because the economy will naturally move to full employment in the long run. If you were a Keynesian, you would advocate intervention in the form of lower taxes or more government spending, because Keynesians do not believe that the economy will achieve full employment by itself.
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In the table above, y is measured along the y-axis and x along the x-axis. What is the value of the slope between the x = 8 and x = 6?
A) -0.057 B) -19.28 C) -35 D) 70
The supply of high-powered money is $100,000 and the money supply is $500,000. If every individual wishes to hold 5% of his or her deposits in the form of cash, then the bank reserve-holding ratio must be
A) 0.25 if banks have made all loans acceptable by the Federal Reserve requirements. B) 0.20 if banks have not made all loans acceptable by the Federal Reserve requirements. C) 0.17 if banks have not made all loans acceptable by the Federal Reserve requirements. D) 0.16 for any of the legally required reserve amount.