Nobody downloaded yet

Should monetary and fiscal policymakers try to stabilize the economy - Essay Example

Comments (0) Cite this document
Summary
One of the most debated of all microeconomics policy is if monetary and fiscal policymakers try to stabilize the economy. To some people the answer is simply yes, to others it is simply no, but the answer to the question is a little more complex than that.
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97.7% of users find it useful
Should monetary and fiscal policymakers try to stabilize the economy
Read TextPreview

Extract of sample "Should monetary and fiscal policymakers try to stabilize the economy"

Download file to see previous pages Also, there is no reason to make people live through the ups and downs that is the business cycle as we know it, and monetary and fiscal policymakers can step in to try to balance out demand, and hence forth stimulate production and employment (Lecture 19). Some people may argue that this is only looking at the "short" run effects, and not taking into consideration the long term effects. Such people would not agree with monetary and fiscal policymakers interfering in the economy, they would rather see less big involvement and a monetary policy based on long term rules(The Short).
"Fiscal or monetary policy can be used to stabilize output and employment around their trend levels, and hence prevent booms or recessions from getting out of hand. When this domestic model is broadened to open the economy to international trade and capital flows, this conclusion no longer holds but the results depend on the flexibility of the nation's exchange rate."(Remarks).
In conclusion, after studying and reading several sources, I have decided that monetary and fiscal policymakers should try to stabilize the economy. This offers a solution to many economic problems, and can help prevent massive swings in our economy, which is always a good thing. ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Should monetary and fiscal policymakers try to stabilize the economy Essay”, n.d.)
Should monetary and fiscal policymakers try to stabilize the economy Essay. Retrieved from https://studentshare.org/miscellaneous/1515129-should-monetary-and-fiscal-policymakers-try-to-stabilize-the-economy
(Should Monetary and Fiscal Policymakers Try to Stabilize the Economy Essay)
Should Monetary and Fiscal Policymakers Try to Stabilize the Economy Essay. https://studentshare.org/miscellaneous/1515129-should-monetary-and-fiscal-policymakers-try-to-stabilize-the-economy.
“Should Monetary and Fiscal Policymakers Try to Stabilize the Economy Essay”, n.d. https://studentshare.org/miscellaneous/1515129-should-monetary-and-fiscal-policymakers-try-to-stabilize-the-economy.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Should monetary and fiscal policymakers try to stabilize the economy

Should the Canadian Government Use Monetary and Fiscal Policy to Stabilize the Economy

...? Should the Canadian Government Use Monetary and Fiscal Policy to Stabilize the Economy? Introduction The Bank of Canada, central bank makes monetary policy. Monetary policy of the central bank determines the nominal interest rate. Rise and fall in interest rate in turn determines the investment and consumption expenditures. Thus, the monetary policy is used to contain the inflation as well as recession. How Monetary Policy Brings Stabilization Canada's monetary policy is woven around mainly two key components. 1. Inflation target 2. Flexible exchange...
3 Pages(750 words)Term Paper

Canadian Monetary and Fiscal Policies

...the country at a very attractive position in terms of the purchasing power of the consumers (2012). In the same vein, the 1.00 percent interest rates evidenced throughout most of that period greatly contributes to the flood of investment opportunities that have inundated the country. As seen from the growth in the GDP, the focus of the fiscal and monetary measures of the Canadian authorities is normally to enhance stability and improve the state of the economy relative to the existing economic situations in the world. Much of these strategies have indeed bore much fruits in Canada and the country can claim a sense of success from the fiscal and...
7 Pages(1750 words)Essay

Monetary and fiscal policy

...Monetary Policy And Fiscal Policy Encounter The Problems Of Lags. Discuss the Kinds of Lags They Encounter and the Degree of Difficulties They Present To Policymakers It is worth mentioning that monetary and fiscal policies help in developing an economy of a particular nation by a significant level. But, on the other hand, it can often be viewed that these policies also encounter certain problems of lags. The lags may appear in different forms and generate problems in various ways. Generally, these lags appear in the form of governmental interventions that seem to create crucial problems. It has been viewed that it is the governments who...
5 Pages(1250 words)Essay

Monetary and fiscal policy

...?Monetary and Fiscal Policy Monetary and Fiscal Policy If the government imposes tax cuts for 95% of all households, my firm will definitely benefit because governments should bailout companies depending on certain circumstances. Although bailing out by imposing tax cuts for 95% of all households seems as going against the capitalistic concepts that compose economy philosophy of our nation, periods such as the great depression have been there as well as the 2008 economic crash where the direct intervention of the government in the economy comes in handy. My firm is an example of successful bailout in case of tax cuts for 95% of all households including services rendered (Shiller, 2008). If my firm had folded like it was the case... in the...
4 Pages(1000 words)Essay

Fiscal and Monetary Policy

...HOW BRITAIN SHOULD TACKLE ITS RECESSION USING THE FISCAL AND MONETARY POLICY 2000wds: November, 2008 TABLE OF CONTENTS 1 Introduction 1.2 Fiscal Policy 1.3 Monetary Policy 1.4 Fighting the Recession using Fiscal Policy 1.5 Fighting the Recession Using Monetary Policy 1.6 Conclusion and the Way Forward 1.0 Introduction The goals of monetary policy are a low rate of inflation ("price stability") and a small gap between actual real GDP and potential real GDP (Farinha & Marques 2001). Inflation can be maintained at low levels by limiting the amount of...
10 Pages(2500 words)Essay

Monetary and fiscal policy

...U.K Fiscal and Monetary Policy and how it affects IS/LM model Each government has a way of trying to make its country’s economy the most stable one in the world. To achieve this, there has to be a balance in the market forces and equilibrium has to be achieved. In this process, the government formulates various policies like the monetary policy and fiscal policy that would influence the economy of the country. Monetary policy is the attempt to control macro economic variables in an economy (primarily inflation) through the use of interest rates. In Britain, the target of...
4 Pages(1000 words)Essay

Fiscal and Monetary Policy

..., it would be government who has to come forward and prepare a discretional fiscal and monetary policy in collaboration with the central bank to reduce the expansionary or contractionary gap. Passive Policy On the other hand, the pundits of passive policy assumes that the current position of economy is quite stable such that the market forces can better interact with each other to achieve the equilibrium in the economy due to the presence of automatic stabilizers in the economy. Strengths of Active Approach Active policy is quite famous among the policymakers due to the fact that by apply this approach the...
2 Pages(500 words)Essay

Fiscal or Monetary

...FISCAL OR MONETARY The in his article d “Monetary Policy: Stabilizing Prices and Output” was giving out a two-tier goal of both achievingprice stability and output stabilization. The larger strategy on which the author was depending on to achieve this goal was the use of monetary policy whereby policy makers were admonished to adjust the supply of money in the economy to achieve the purported goal of inflation and output stabilization (Mathai, 2011). At the time of writing the article, among the three principal entities of stable prices, full employment and economic growth, the most important of them at the time was stable prices. This is because the article was written at a time when the global economy had generally recovered... ...
1 Pages(250 words)Research Paper

Fiscal and Monetary Policy

...for the economy, and the levels of employment and unemployment, with the ideal being full employment. In the United States, moreover, the existing mandate to the Federal Reserve Board emanating from Congress is for the former to promulgate fiscal policy decisions that will push employment numbers to the maximum as well as achieve stability in prices of goods and services (Board of Governors of the Federal Reserve System, 2014; Investopedia LLC, 2014l SparkNotes LLC, 2014). Separate from this general two-component mandate, however, the US Central Bank has autonomy with regard to the operational aspects of achieving those mandates, and that means that the US Federal Reserve Board has the...
5 Pages(1250 words)Essay

Monetary policy&fiscal policy

...Monetary Policy and Fiscal Policy Summary of the Monetary Policy Article Federal Reserve recognized that the rate of economic growth was not so fast and the central bank decided to continue purchasing bonds at the rate of $85 billion per month as offered in Fed’s program, as a way of stimulating the economy. Jim Zarroli from NPR in his explanation of whether the program has anything to contribute towards the direction of the economy declined to it having much contribution stating that the view of Fed in the economy is concerned about what has been for some time. He views this as being middling. He notes in relation to this, the high...
2 Pages(500 words)Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Should monetary and fiscal policymakers try to stabilize the economy for FREE!

Contact Us