91影视

Monetary policy is used by the central bank to control the liquidity of plutocrat from frugality to bring the frugality to stablecondition.This is done through operation of interest rate and the plutocrat force. Objects of a financial policy are high employment and affair stability, profitable growth, stability of fiscal requests, interest rate stability, and stability in foreign exchange requests. Aggregate demand is the total demand of goods and services in an frugality. Aggregate claim is the aggregate of consumption, investment, administration charge and net exports.

affectedness is the overall increase in general price position of an frugality. affectedness causes increase in the price of goods and services which decreases exports and fall in aggregate demand.

A.

Given,

$\stackrel{炉}{\mathrm{C}}$is $\$3.25$trillion.

$\stackrel{炉}{I}$is $\$1.3$trillion.

$\stackrel{炉}{G}$is $\$3.5$trillion.

$\stackrel{炉}{\mathrm{T}}$is $\$3$trillion.

$\stackrel{炉}{NX}$is $-\$1$trillion.

$\stackrel{炉}{f}$is $1$

$\mathrm{mpc}$is $0.75.$

$d$is 0.3.

xis 0.1.

$\stackrel{炉}{\mathbf{r}}$is $1.$

$位$is $1.$

MP curve equation is:

$\mathrm{r}=\stackrel{炉}{\mathrm{r}}+位蟺\left(1\right)$

AD curve equation is as,

$\mathrm{Y}=[\stackrel{炉}{\mathrm{C}}+\stackrel{炉}{\mathrm{I}}-\mathrm{d}\stackrel{炉}{f}+\stackrel{炉}{\mathrm{G}}+\stackrel{炉}{\mathrm{NX}}-mpc脳\stackrel{炉}{\mathrm{T}}]脳\frac{1}{1-mpc}-\frac{\mathrm{d}+x}{1-mpc}脳(\stackrel{炉}{\mathrm{r}}+位蟺)\left(2\right)$

Where,

- $Y$is the Aggregate demand.

- $\stackrel{炉}{\text{Cis autonomous consumption.}}$

- Iis the investment expenditure .

- $\mathrm{d}$is investment responsiveness to real interest rate.

- $\stackrel{炉}{f}$is financial frictions.

- $\stackrel{炉}{G}$is Government expenditure.

- $\stackrel{炉}{\mathrm{NX}}$is net export.

- mpc is marginal propensity to consume.

- Tis the tax.

- xis net export responsiveness to real interest rate.

- ris autonomous component of real interest rate.

- $位$is the responsiveness of real interest rate to inflation rate.

- $蟺$is the inflation rate .

Substitute the values of $\stackrel{炉}{r}$and $位$in the equation (1),

$r=1+蟺$

Hence, the MP curve equation is $r=1+蟺$.

Substitute the values in equation (2),

$$\begin{gathered} Y=[3.25+1.3-0.3脳1+3.5-1-0.75脳3]脳\frac{1}{1-0.75}-\frac{0.3+0.1}{1-0.75}脳(1+蟺) \\ Y=[4.5]脳\frac{1}{0.25}-\frac{0.4}{0.25}脳(1+蟺) \\ Y=18-1.6脳(1+蟺) \\ Y=16.4-1.6蟺 \end{gathered}$$

Hence, the $AD$equation is localid="1648505220881" $Y=16.4-1.6蟺$.

B.

Given,

$\stackrel{炉}{\mathrm{C}}$is $\$3.25$trillion.

$\stackrel{炉}{I}$is $\$1.3$trillion.

$\stackrel{炉}{G}$is $\$3.5$trillion.

$\stackrel{炉}{\mathrm{T}}$is$\$3$trillion.

$\stackrel{炉}{\mathrm{NX}}$is $-\$1$trillion.

$\stackrel{炉}{f}$is $1.$

$\mathrm{mpc}$is $0.75$.

$d$is $0.3$.

xis $0.1$.

$\stackrel{炉}{r}$is $1.$

$位$is $1.$

$蟺$is 1 .

The MP curve equation is$r=1+蟺$

Substitute value of $蟺$to determine real interest rate in the above equation,

Real interest rate$=1+1$$=2$

Hence, the value of real interest rate is $2\%$when inflation is given as $1\%$in the economy.

The $AD$equation is$Y=16.4-1.6蟺$

Substitute value of $蟺$to determine equilibrium level of output in the above equation,

Equilibrium level of output$=16.4-1.6脳1$

$=14.8$

Hence, the value of equilibrium level of output is $\$14.8$trillion.

The formula of consumption expenditure is:

$\mathrm{C}=\stackrel{炉}{\mathit{C}}+mpc脳(\mathrm{Y}-\stackrel{炉}{\mathrm{T}})$

Substitute the value of equilibrium output level and the given value of autonomous consumption, tax and marginal propensity to consume role="math" localid="1648503381445" $\left(mpc\right)$in the above formula,

role="math" localid="1648503473900" $$\begin{gathered} C=3.25+0.75脳(14.8-3) \\ C=\$12.1 \end{gathered}$$

Hence, the value of consumption expenditure is $\$12.1$trillion.The formula for planned investment is:

$\mathrm{I}=\stackrel{炉}{\mathrm{I}}-\mathrm{d}(\mathrm{r}+\stackrel{炉}{f})$

Substitute, the value of real interest rate with the given values of fixed investment, $\mathrm{d}$and $\stackrel{炉}{f}$in the above formula,

$$\begin{gathered} I=1.3-0.3脳(2+1) \\ I=\$0.4 \end{gathered}$$

Hence, the value of planned investment is $\$0.4$trillion.

The formula for net export is:

$\mathrm{NX}=\stackrel{炉}{\mathrm{NX}}-x\mathrm{r}$

Substitute the value of real interest rate in the above formula,

$$\begin{gathered} NX=-\$1-0.1脳2 \\ =-\$1.2 \end{gathered}$$

Hence, the value of net export is $-\$1.2$trillion.

C.

Given,

$\stackrel{炉}{\mathrm{C}}$is $\$3.25$trillion.

$\stackrel{炉}{I}$is $\$1.3$trillion.

$\stackrel{炉}{\mathrm{G}}$is $\$3.5$trillion.

$\stackrel{炉}{\mathrm{T}}$is $\$3$trillion.

$\stackrel{炉}{NX}$is $-\$1$trillion.

$\stackrel{炉}{f}$is $1.$

$\mathrm{mpc}$is $0.75$.

$d$is $0.3$.

x is$0.1$.

$\stackrel{炉}{\mathbf{r}}$is $2.$

$位$is $1.$

$蟺$is 1 .

The MP curve equation is$r=1+蟺$

Substitute the value of $蟺$to determine real interest rate in the above formula,

Real interest rate$=2+1$

$=3$

Hence, the value of real interest rate is $3\%$as the value of $\stackrel{炉}{r}$change from $1\%$to $2\%$in the economy.

AD curve equation is:

$\mathrm{Y}=[\stackrel{炉}{\mathrm{C}}+\stackrel{炉}{\mathrm{I}}-\mathrm{d}\stackrel{炉}{f}+\stackrel{炉}{\mathrm{G}}+\stackrel{炉}{\mathrm{NX}}-mpc脳\stackrel{炉}{\mathrm{T}}]脳\frac{1}{1-mpc}-\frac{\mathrm{d}+x}{1-mpc}脳(\stackrel{炉}{\mathrm{r}}+位蟺)$

Where,

- $Y$is the Aggregate demand.

-$\stackrel{炉}{\text{Cis autonomous consumption.}}$

- lis the investment expenditure.

- d is investment responsiveness to real interest rate.

- $\stackrel{炉}{f}$is financial frictions.

-$\stackrel{炉}{\text{Gis Government expenditure.}}$

-$\stackrel{炉}{\text{NXis net export.}}$

- mpc is marginal propensity to consume.

- Tis the tax.

- xis net export responsiveness to real interest rate.

- $\stackrel{炉}{蟺}s$autonomous component of real interest rate.

- $位$is the responsiveness of real interest rate to inflation rate.

- $蟺$is the inflation rate.

Substitute, value of changed $\stackrel{炉}{r}$to determine equilibrium level of output.

$$\begin{gathered} Y=\left[3.25+1.3-0.3脳1+3.5-1-0.75脳3\backslash \mathrm{rrbracket}脳\frac{1}{1-0.75}-\frac{0.340.1}{1-0.75}脳\right. \\ =[4.5]脳\frac{1}{0.25}-\frac{0.4}{0.25}脳(2+蟺) \\ =18-1.6脳(2+蟺) \\ =14.8-1.6蟺 \end{gathered}$$

Substitute the value of$p$in the above formula,

$Equilibriumlevelofoutput=14.8-1.6脳1=13.2$

Hence, the value of equilibrium level of output is $\$13.2$trillion.

The Consumption expenditure is:

$\mathrm{C}=\stackrel{炉}{\mathit{C}}+mpc脳(\mathrm{Y}-\stackrel{炉}{\mathrm{T}})$

Substitute, the value of equilibrium output level and the given value of autonomous consumption, tax and marginal propensity to consume ( $\mathrm{mpc}$) to determine the value of consumption expenditure.

$$\begin{gathered} C=3.25+0.75脳(13.2-3) \\ =\$10.9 \end{gathered}$$

Hence, the value of consumption expenditure is $\$10.9$trillion.

The planned investment is:

$I=\stackrel{炉}{\mathrm{I}}-\mathrm{d}(\mathbf{r}+\stackrel{炉}{f})$

Substitute, the value of real interest rate with the given values of fixed investment, $\mathrm{d}$and $\stackrel{炉}{f}$to determine the value of planned investment.

$$\begin{gathered} I=1.3-0.3脳(3+1) \\ \mathrm{I}=\$0.1 \end{gathered}$$

Hence, the value of planned investment is$\$0.1$ trillion.

The net export is$\mathrm{NX}=\stackrel{炉}{\mathrm{NX}}-x\mathrm{r}$

Substitute the value of real interest rate to determine the value of net export.

$$\begin{gathered} NX=-1-0.1脳3 \\ =-\$1.3 \end{gathered}$$

D.

The Fed may believe that the frugality will strengthen in the future and there is a threat that affectedness will raise in the future, so they increased $\stackrel{炉}{\mathbf{r}}$. A change in independent element of real claim rate will affect real claim rate directly. Real claim rate increases with an increase in$\stackrel{炉}{\mathrm{r}}$. Fed can only control $\stackrel{炉}{\mathrm{r}}$, thus, Fed affect the real claim rate through increase or drop in $\stackrel{炉}{r}$.