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Topic: Expansionary monetary policy


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In the News (Tue 21 May 19)

  
  Monetary policy - Wikipedia, the free encyclopedia
Monetary policy can involve setting interest rates, margin requirements, capitalization standards for banks or even acting as the lender of last resort or through negotiated agreements with other governments.
Monetary policy was seen as an executive decision, and was generally in the hands of the authority with seniorage, or the power to coin.
Today this type of monetary policy is not used anywhere in the world, although a form of gold standard was used widely across the world prior to 1971.
en.wikipedia.org /wiki/Monetary_policy   (3387 words)

  
 RBA: Education-Monetary Policy
In these countries, monetary policy could be described as the management of short-term interest rates by central banks in pursuit of the domestic policy objectives, usually defined in terms of inflation and economic growth.
Monetary targeting was abandoned in Australia, and in most other countries, because it was found that the monetary aggregates were becoming increasingly unstable and unrelated to the variables of ultimate concern.
Monetary policy decisions always have to be made on the basis of imperfect information about economic prospects, and the money and credit aggregates represent part of the information (along with an array of other economic indicators) that can potentially help in making these assessments.
www.rba.gov.au /Education/monetary_policy.html   (6804 words)

  
 Monetary policy - free-definition   (Site not responding. Last check: 2007-10-14)
Monetary policy is the financial policy of managing the money supply to achieve specific goals—such as reducing inflation or achieving full employment or more well-being.
Monetary policy is also often expressed by the central bank trying to target or manipulate the exchange rate with major trading partners.
Minting coins was effectively the first government monetary policy, since it allowed for more free flows of money through the economy (it increased the 'velocity' of the money supply).
www.free-definition.com /Monetary-policy.html   (2309 words)

  
 Lecture Outline   (Site not responding. Last check: 2007-10-14)
Monetary policy needs to maintain credibility, because credibility helps insure that the goals of policy will be attained during a period of dynamic economic and financial developments.
Policy credibility is enhanced by building a record of achievement of the stated goals of policy and by consistently following stated policy principles.
This contractionary fiscal policy was meant to be counteracted by expansionary monetary policy.
www.wright.edu /~rudy.fichtenbaum/syllabi/ec203/ec203mat/chap0017/1704outl.htm   (2257 words)

  
 Monetary Policy
The purpose of monetary policy is to maintain the trend of economic output, employment, and prices at desired levels.
A policy of the Fed designed to expand the growth of money and credit in the economy is known as an expansionary (or loose) monetary policy.
The discount rate is probably the least strong of the three principal tools of monetary policy, but the Federal Reserve does use a change in it to indicate an overall tightening or loosening of monetary policy.
www.mcps.k12.md.us /schools/wjhs/depts/socialst/hagan/classes/NSLB/Unit5/Monetary_Policy.htm   (1040 words)

  
 chapter 5 notes
An expansionary (easy) fiscal policy is one that increases aggregate demand; it involves a decrease in tax rates and/or an increase in government expenditure that increases the structural deficit (or decreases the structural budget surplus).
A contractionary (tight) fiscal policy is one that decreases aggregate demand; it involves an increase in tax rates and/or a decrease in government expenditure that reduces the structural budget deficit or increases the structural budget surplus.
Effectiveness lag of monetary policy: the most difficult lag to measure is the effectiveness lag between a change in monetary policy and its impact on aggregate demand.
www.ndsu.nodak.edu /instruct/swandal/ECON343s/notes/chap5.htm   (3449 words)

  
 Monetary Policy, by James Tobin: The Concise Encyclopedia of Economics: Library of Economics and Liberty
Monetary policy is the subject of a lively controversy between two schools of economics, monetarist and Keynesian.
Monetary and fiscal policies are distinct only in financially developed countries, where the government does not have to cover budget deficits by printing money but can sell obligations to pay money in the future, like U.S. Treasury bills, notes, and bonds.
Monetarist policies are premised on a tight linkage between the stock of money in dollars, say M1, and the flow of spending, GNP in dollars per year.
www.econlib.org /library/Enc/MonetaryPolicy.html   (3330 words)

  
 Virtual Economy Glossary (D-F)
Deflationary fiscal policy is using the level of government expenditure and taxation to reduce the level of aggregate demand in the economy.
Deflationary monetary policy is using interest rates and other monetary policies to reduce the level of aggregate demand in the economy.
Deflationary policies are policies that are aimed to reduce the level of aggregate demand in the economy and therefore slow down the rate of growth of output.
www.bized.ac.uk /virtual/economy/library/glossary/glossarydf.htm   (1451 words)

  
 [No title]
Fiscal policy is based on the illusion that you can confiscate the wealth/income of one group of people and give it to another group of people, and raise the standard of living of everybody.
The economy moves from Y1 to Y2 in Exhibit 13-2 because the expansionary policy is unanticipated.
If monetary policy is fully anticipated and resource suppliers have fully incorporated inflationary expectations into their decisions, output is not affected even in the short run.
spruce.flint.umich.edu /~mjperry/notes13.htm   (2476 words)

  
 Gwartney CHAPTER 14
This restrictive monetary policy generally describes the monetary policy of a few years ago in 1999-2000, the Fed was trying to slow down the economy, to prevent it from inflationary "overheating" by raising interest rates six times to dampen AD slightly.
But if the expansionary policy is fully anticipated and resource suppliers have fully incorporated inflationary expectations into their decisions, output is not affected even in the short run.
There may not always be a close short-run relationship between changes in monetary policy and changes in output, inflation and interest rates due to lags and due to some prices being set by long term contracts.
spruce.flint.umich.edu /~mjperry/Unit16.html   (3458 words)

  
 [No title]
The effect of a monetary injection on aggregate demand is much stronger in an open economy as compared to a closed economy.
Fiscal policy influences C and I by altering spending decisions of households and firms.
Monetary policy, although quickly implemented, affects the economy with considerable lags (1/2 to 1 1/2 years).
web.uvic.ca /~ramanik/104s/chapter13macro.ppt   (2471 words)

  
 SNB BNS+ Monetary policy: Monetary policy report 1996   (Site not responding. Last check: 2007-10-14)
We endeavoured to provide the economy with sufficient monetary leeway for a rapid cyclical recovery and to counteract deflationary pressures emanating from the strength of the Swiss franc.
Banknote circulation reacts to changes in monetary policy with a time lag of several months since it is influenced less markedly by money market than by savings deposit rates.
Another reason for the strong expansion of the monetary base in 1996 is to be seen in the liquidity behaviour of various banks, which increased their sight deposit holdings at the National Bank and reduced their postal cheque account balances.
www.snb.ch /e/geldpolitik/bericht/content_ber.html   (747 words)

  
 Monetary Policy and Real Economic Growth   (Site not responding. Last check: 2007-10-14)
Most economists will concede that monetary policy can affect real economic growth, at least in the short term, but caution that it may do so only when the public fails to anticipate the policy change and then misinterprets the accompanying price adjustments.
The Federal Reserve System's main instrument for conducting monetary policy is the purchase and sale of government bonds in the secondary market (open-market operations).
Many economists believe that connections between aggregate spending and monetary policy are substantially broader and more complicated than those described by the conventional interest-rate view, even as modified with an exchange-rate effect.
www.clevelandfed.org /research/com/1296.htm   (1937 words)

  
 Effects of Expansionary Monetary Policy on Interest Rates
In this dynamic context, expansionary monetary policy can mean an increase in the rate of growth of the money supply, rather than a mere increase in money.
Thus, expansionary monetary policy (i.e., an increase in the money supply) will cause a decrease in average interest rates in an economy.
In contrast, contractionary monetary policy (a decrease in the money supply) will cause an increase in average interest rates in an economy.
internationalecon.com /v1.0/Finance/ch40/F40-9.html   (442 words)

  
 Monetary Policy   (Site not responding. Last check: 2007-10-14)
Changes in central bank policy or in bank reserves, designed to influence the interest rate and thus investment, production and employment, are called monetary policy.
This is called "expansionary monetary policy." Recall, earlier in this chapter we hinted that it might be possible to stimulate increased production by indirectly stimulating investment.
Expansionary monetary policy does this, according to the Complete Keynesian Model.
william-king.www.drexel.edu /top/prin/txt/complete/AD4a.html   (212 words)

  
 Monetary Policy   (Site not responding. Last check: 2007-10-14)
Expansionary monetary policy is one active policy for this situation.
Lags are the greatest obstacle facing the Fed in the implementation of monetary policy.
The impact of monetary policy on the economy is uncertain and varies in different
webster.commnet.edu /faculty/~jascot/ch11macro.htm   (1524 words)

  
 Monetary Policy Definition - The Biggest Policy Resource On The Internet   (Site not responding. Last check: 2007-10-14)
Monetary policy is the financial policy of managing the money supply to achieve specific goals—such as...
ES3852/ Monetary Theory and Policy ES3852/ Monetary Theory and Policy ding of the term structure of interest rates; (iv) demonstrate recent debates on rules of discretion and time inconsistency in monetary policy.
The implication of these reforms on monetary policy is the focus of this section...
policy.cappuccinoscorner.com /index.php?k=monetary-policy-definition   (1197 words)

  
 eco343psets
The country’s policy makers are evaluating the macroeconomic policy tools that could be used to eliminate or at least reduce the unemployment.
Assuming that these policies are expected to be temporary, demonstrate how such policies would affect this economy in terms of the output and employment level as well as the interest rate and exchange rate.
Assuming that these policies are expected to be permanent, demonstrate how such policies would affect this economy in terms of the output and employment level as well as the interest rate and exchange rate.
www.oswego.edu /~atri/eco343pests.htm   (10356 words)

  
 infos - expansionary fiscal policy and boeing   (Site not responding. Last check: 2007-10-14)
Should further expansionary monetary and fiscal policies be used now, or...
greater prudence in the expansionary fiscal and monetary policies that...
Adoption of a slightly expansionary monetary policy in the backdrop of...
www.perrschy.de /expansionary_fiscal_policy_and_boeing.html   (253 words)

  
 Money: Monetary policy - Question Bank
An example of an expansionary monetary policy is
Suppose that the Bank of England enters the open market and purchases £15 million of government bonds from the general public.
cause bank reserves to decline, the monetary base to fall, and the banking system's lending capacity to decline
www.bized.ac.uk /learn/economics/qbank/money4.htm   (413 words)

  
 Monetary Policy   (Site not responding. Last check: 2007-10-14)
Monetary Policy does not work in Russia´s Barter Economy -
Based on the finding that barter is a response to imperfect capital and input markets, the paper argues why expansionary monetary policy in barter economies such as Ukraine and Russia might fail to be effective.
In order to remonetize these economies the paper suggests a relationship based reform of the banking sector.
www.vwl.uni-muenchen.de /ls_marin/abstract/bartereconabs.html   (88 words)

  
 Expansionary Monetary Policy v. Income Effect   (Site not responding. Last check: 2007-10-14)
Expansionary monetary policy tells us that as the money supply increases interests rates will decline.
On the other hand the Income Effect says that increasing the money supply, due to wealth, is a rise in interest rates.
My qestion is do these two offset each other?
www2.tltc.ttu.edu /hein/_33232000/0000008a.htm   (54 words)

  
 Monetary Policy   (Site not responding. Last check: 2007-10-14)
What type of gap is the economy currently experiencing?
What type of monetary policy would you recommend?
Specifically, what type of open market operations would you recommend?
www-personal.washtenaw.cc.mi.us /~kaltese/webdoc7q.html   (131 words)

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