Monetarists assume that the velocity of money is unaffected by monetary policy at least in the long runand the real value of output is determined in the long run by the productive capacity of the economy. Under these assumptions, the primary driver of the change in the general price level is changes in the quantity of money. With exogenous velocity that is, velocity being determined externally and not being influenced by monetary policythe money supply determines the value of nominal output which equals final expenditure in the short run. In practice, velocity is not exogenous in the short run, and so the formula does not necessarily imply a stable short-run relationship between the money supply and nominal output.
Markets The return of U. Inrookie pitcher phenomenon Stephen Strasburg signed the largest rookie contract in baseball history. These stories show how a well-functioning free market pricing system determines how producers manufacture goods, what they will pay, what goods will be manufactured, and for whom the goods will be produced.
Go to this unit. The Firm InCoca Cola replaced sugar with high fructose corn extract in order to alleviate higher production costs.
InStudebaker closed its plant, unable to increase sales and take advantage of assembly line production. In the new century, printing and publishing company Printpod, Inc. These stories show how competitive firms minimize their costs of production by utilizing an optimal combination of inputs and scale of operation, while others fall by the wayside.
Supply and Demand A two-year drought in California in the s motivated areas such as Marin County to conserve by reducing their water consumption by as much as 66 percent. Following the Arab oil embargoes ofthe Nixon administration latched onto the world price of "new" oil, encouraging domestic oil suppliers to drill again.
Jordache designer jeans used creative advertising to create a demand for blue jeans. These stories illuminate factors that determine the quantity of goods demanded by consumers and the factors that determine the quantity of goods supplied.
AfterPresident Franklin D. Roosevelt sought to improve the conditions of farmers via policies in his New Deal plan.
Government subsidies later allowed for corporate ownership of a majority of farmers. The Freedom to Farm Bill of gave farmers a little more maneuverability, but for the most part farmers are still held to the fluctuating demand statuses of large competitive firms.
Economic Efficiency In preparation for WWII, the Roosevelt administration instituted wage price and price controls to curb inflation and better focus production on war materials.
When the Nixon administration set up price controls for beef, farmers attempted to stifle the supply by withholding animals from the markets. Following WWII, rent controls established to aid returning war veterans cut into landlord profits and consequently led some to abandon properties.
MACRO-ECONOMIC| Discuss the role of government policy in reducing unemployment and inflation. In your discussion make use of the diagrammatic representation of the macroeconomy developed in lectures in Term 2| Unemployment and inflation are factors that have negative effects on the performance of the economy as a whole. Get the latest international news and world events from Asia, Europe, the Middle East, and more. See world news photos and videos at leslutinsduphoenix.com The Bureau of Labor Statistics is the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics.
These stories examine how the "invisible hand" behind free markets operates, the reasons for interfering with free markets, and the costs of doing so. Rockefeller and his company, Standard Oil, had on the oil industry. Inthe federal government was sold on the concept of universal telephone service provided by Ma Bell, a monopoly that was ended by the development of a new technology.
Inthe U. These stories explain what monopolies are, and why government sometimes chooses to intervene. Ina reporter for the Knoxville News-Sentinel discovered a price-fixing scandal between three big-name electric companies in each of their closed bids to the Tennessee Valley Authority.
In the late s, President Jimmy Carter ordered Professor Alfred Kahn to deregulate the airline industry, which had been a federally protected oligarchy. These are all examples of oligopolies and the forces that influence them. AfterLos Angeles was looking for a broad-ranging smog-reduction policy to reflect recently amended Clean Air Act standards.
Inthe House of Representatives introduced the first piece of comprehensive clean energy legislation, known as the American Clean Energy and Security Act, which both economists and energy providers could support.
Pollution is a "negative externality," which, as these stories show, can have serious consequences for economic efficiency. Why does Walmart choose low prices over high wages, and how do they get away with it?
These stories show how labor unions and corporate managers battle to affect the supply of labor, wages, and prices. Profits and Interest In response to rising interest rates in the s, the Maryland legislature raised usury ceilings so that more home loans would be available.
In December of Apple Computers went public, affirming four years of hard work with substantial compensation for its founders. Pharmaceutical companies invest millions in bringing new drugs to market.Fiscal policy.
Controlling aggregate demand is important if inflation is to be controlled. If the government believes that AD is too high, it may choose to ‘tighten fiscal policy’ by reducing its own spending on public and merit goods or welfare payments.
MACRO-ECONOMIC | Discuss the role of government policy in reducing unemployment and inflation.
In your discussion make use of the diagrammatic representation of the macroeconomy developed in lectures in Term 2 | Unemployment and inflation are factors that have negative effects on the performance of the economy as a whole.
Get the latest international news and world events from Asia, Europe, the Middle East, and more. See world news photos and videos at leslutinsduphoenix.com Discuss the role of government policy in reducing unemployment and inflation. In your discussion make use of the diagrammatic representation of the macroeconomy developed in lectures in Term 2 | Unemployment and inflation are factors that have negative effects on the performance of .
Explore economic history, theory, and practice through case studies and interviews with Nobel-prize winning and major economists.
The series covering macro, micro, and international economics features Milton Friedman, Paul Samuelson, John Kenneth Galbraith, Alice Rivlin, and Ben Bernanke, among others. Demand side policies to reduce demand-deficient unemployment (unemployment caused by recession) Supply side policies to reduce structural unemployment / (the natural rate of unemployment) A quick list of policies to reduce unemployment: Monetary policy – cutting interest rates to boost Aggregate Demand (AD) Fiscal policy – cutting taxes to boost AD.