Here are the links 1.: http://www.federalreserve.gov/monetarypolicy/fomccalendar

Question

Here are the links 1.: http://www.federalreserve.gov/monetarypolicy/fomccalendars.htm 2. http://www.federalreserve.gov/monetarypolicy/beigebook/default.htm

Using the links provided up above i have to answer the following questions

1. Is the economy now at full employment, or is it experiencing cyclical unemployment?

2. Should the Fed try to lower the unemployment rate to zero?

3. Has inflation been stable, rising, or falling?

4. Why is inflation bad, i.e., why should we desire low and stable inflation?

5. Is current inflation low enough? Too low or too high?

6. How does GDP growth over the last year compare to GDP growth over the previous 20 years? So is the economy ill, healthy, or so-so?

7. Does the federal budget deficit represent a threat to the economy? Try to balance the budget using the budget simulator a

Explanation / Answer

(1) The economy is experiencing cyclic unemployment.

(2) The Fedral Reserve must try to decrease the rate of unemployment as zero.

(3) The rate of inflation is falling down.

(4) Inflation is considered to be bad as it tends to bring unemployment, increased rate of interest, poverty, market failure and decline in GDP in a country.

(5) The current inflation is low enough. The reason is that there is rise in the employment as compared to the time of inflation.

(6) The growth of GDP as compared to the previous year has shown a hike in the economy.

(7) The Federal Budget deficit represents a threat to the economy. In case of more expenditure by the government then there is going to be reduction in the national wealth.

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.