Purpose of Assignment
Week 3 will help students develop
an understanding of what money is, what forms money takes, how the banking
system helps create money, and how the Federal Reserve controls the quantity of
money. Students will learn how the quantity of money affects inflation and
interest rates in the long run, and production and employment in the short run.
Students will find that, in the long run, there is a strong relationship
between the growth rate of money and inflation. Students will review the basic
concepts macroeconomists use to study open economies and will address why a
nation’s net exports must equal its net capital outflow. Students will
demonstrate the relationship between the prices and quantities in the market
for loanable funds and the prices and quantities in the market for
foreign-currency exchange. Student will learn to analyze the impact of a
variety of government policies on an economy’s exchange rate and trade balance.
Assignment Steps
Resources –http://www.nber.org/links/gov.html
Developa 2,100-word economic outlook forecast that includes the
following:
·
Introduction
·
Analyze the history of changes
in GDP, savings, investment, real interest rates, and unemployment and compare
to forecast for the next five years.
·
Discuss how government policies
can influence economic growth.
·
Analyze how monetary policy
could influence the long-run behavior of price levels, inflation rates, costs,
and other real or nominal variables.
·
Describe how trade deficits or
surpluses can influence the growth of productivity and GDP.
·
Discuss the importance of the
market for loanable funds and the market for foreign-currency exchange to the
achievement of the strategic plan.
·
Recommend, based on your above
findings, whether the strategic plan can be achieved and provide support.
·
Conclusion
Usea minimum of three peer-reviewed sources from the University
Library.
