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.
Nobody downloaded yet

Economics - Research Paper Example

Comments (0)
Summary
Economics Introduction Federal funds refer to the immediate borrowings by the banking institutions to keep the bank reserves stable which is conducted by controlling the federal funds rate (Thornton, 2007). The objective of this paper is to identify the influence of the fluctuations in terms of federal funds rate upon the demand in an economy, the trend of money supply and the stock market along with the interest and spending as well as interest and investment related aspects…
Download full paper
GRAB THE BEST PAPER
Economics
Read TextPreview

Extract of sample
Economics

Download file to see previous pages... For instance, a reduction in the target federal funds rate by the Federal Open Market Committee is quite likely to lead towards a fall in the short term interest rates which are mostly charged on commercial papers and treasury bills among other financial products (Federal Reserve Bank of Richmond, 2012). The short term interests are affected not only by the current federal funds rate but also by the expected overnight changes in the rates (Board of Governors of the Federal Reserve System, 2011). The influence of federal fund rates on the interest rates has been shown in the figure below: Source: Money Cafe (2012) In addition, the changes in the federal funds rate also have certain noteworthy effects on the foreign exchange rates within an economy. For instance, if the fund rates increase in the United States, investing in dollar assets may seem to be more favourable, which in turn may result in the increase of the value of dollar in the foreign exchange market (Board of Governors of the Federal Reserve System, 2011). Furthermore, the Federal Reserve plays a vital role in setting up the monetary policies for a nation which includes the setting up of reasonable long-term interest rates as well. ...
One of the major functions of the Federal Reserve is to control the money supply and credit supply in the economy in order to support the economic goals of a nation (Federal Reserve Bank of Richmond, 2012). Likewise, the increase in the federal funds rate might also cause the short term interest rates to rise. This can further lead the business houses and the customers to reduce their expenditures causing a decrease in the economic activities and leading to a fall in the employment rate (Modeste & Mustafa, 2002). A reduction in the in the interest rates of Federal Reserve is likely to result in the decrease in income and output level of the economy. The ‘contraction policies’ implemented by the Federal Reserve is mainly focused on controlling the cumulative demand in an economy. These ‘contraction policies’, have often been observed to lead towards a decrease in the aggregate supply of money within the economy. This results in an increase in the interest rates which eventually decreases the investment level within an economy leading towards a substantial fall in the overall output level (Khawaja, 2012). The following diagram illustrates the influence of federal funds rate fluctuations on the output gap: Source: (Bivens, 2012) The federal fund rates have significant effect on inflation as well. A decrease in the federal fund rates is likely to result in an increase in the demand for goods and services. This increase in demand for commodities in turn enhances the employment opportunities for labours and requirement for raw materials for the production purpose (Board of Governors of the Federal Reserve System, 2011). This aspect can be evidently observed from ...Download file to see next pagesRead More
Comments (0)
Click to create a comment
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Managerial Economics
Once the company begins to receive more profit, it plans to expand its business in other niches like business process outsourcing to assist other companies in business operations. The present dilemma is the economic costs that the company might experience, as it focuses on the plans for the promotion of the new packages.
10 Pages(2500 words)Research Paper
Managerial Economics
yet only 7.3 million or only 23.6 percent of them uses hearing aids. It will be interesting to find out why it is so. Hearing aid is not yet so full proof a device to equate it with refractive lenses used to correct the vision of eyes. So as to say, no hearing aid restores the hearing in a most natural manner.
8 Pages(2000 words)Research Paper
Austrian Economics
Menger observed and then explained the real fluctuations in the commodity prices while working as an economic journalist in Vienna. The commodity prices are based upon their marginal contribution as they fulfill the desires of the individuals (Jaffe, 1976).
15 Pages(3750 words)Research Paper
Economics
I strongly agree with the views of CATHERINE RAMPELL and this paper is written favor of the views and opinions of CATHERINE RAMPELL which are expressed in the above article (Rampell) The above chart clearly shows that around 21 percent of income was received by just 1 percent of earners.
4 Pages(1000 words)Research Paper
Economics
Rich advocates for the utilization of gradual decrease in the benefit of those who are able to get a job instead of a nine-month cutoff period once the person is able to cross the threshold of $1,000. “That way, they preserved some benefits as they eased back to work, rather than losing them all after just nine months” (par.
3 Pages(750 words)Research Paper
Japanese Economics

The author states that a significant trend to the expansion of the economy was the welfare society in Japan instead of the welfare state. This helped Japan to direct most of its resources that would have been spent on welfare to industrial expansion. After 1950s, the Japanese government engaged in massive financing of the economy.

9 Pages(2250 words)Research Paper
Labor Economics
The knowledge that an employee possesses originates from either classroom or on-job-training and more often both. In the recent past, there has been a great controversy as to whether on-job-training or school education is more effective in equipping an employee with effective working knowledge.
3 Pages(750 words)Research Paper
Labor Economics and Welfare Economics
e form of employees in a given economy, the demands of these employees, and efforts to comprehend the ensuing pattern of their earnings, service, and salaries. Old welfare economics followed two key presumptions. First, one can measure utility in terms of money and is a
5 Pages(1250 words)Research Paper
Economics
The current information age founded in computers has evolved the manner in which firms carry out their operations along with the need to address
4 Pages(1000 words)Research Paper
Economics
rity faced by countries and businesses, and organizations should fend off the present information security risks that arise from disgruntled workers who release sensitive information, cybercriminals or people who engage in online fraud (Peltier, 2005). Even though the
3 Pages(750 words)Research Paper
Let us find you another Research Paper on topic Economics for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us