Question

If the United States is a large open economy with perfect capital mobility, the effect of...

If the United States is a large open economy with perfect capital mobility, the effect of the U.S. government stimulate package to offset the effect of pandemic will _________ net exports, and the real exchange rate of the U.S. dollar against foreign currencies will

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Home is a small open economy with perfect (financial) capital mobility. Initially, it is in its...
Home is a small open economy with perfect (financial) capital mobility. Initially, it is in its long-run equilibrium and domestic assets and foreign assets are prefect substitutes. Recently, the United States reformed its tax system and lowered taxes. Many believe that this kind of development might have negative impacts on the Home economy and people worry that the negative impacts include the following: Change the world interest rate (Hint: you need to figure out what happens to the world interest...
Assuming perfect capital mobility and flexible exchange rates, explain the impact on the Irish economy of...
Assuming perfect capital mobility and flexible exchange rates, explain the impact on the Irish economy of a decrease in interest rates in the U.S. In your answer, clearly indicate the effect on income, rate of interest, balance of payments. (Show your answer with the help of an IS-LM-BP diagram and explain the mechanisms. Consider Ireland a small open economy with flexible exchange rates. b) Are Monetary and Fiscal policies effective in the case of question (a)? Explain with graphs
Consider a small, open economy with perfect capital mobility and a fixed exchange rate regime, whose...
Consider a small, open economy with perfect capital mobility and a fixed exchange rate regime, whose domestic interest rate is currently the same as the foreign interest rate. Suppose that it adopted the USD as its official currency. a. Draw the IS-LM diagram for this nation at its general equilibrium point E1, with equilibrium income level Y1 and domestic interest rate r1, what happened if central bank of this country expanded its money supply, please show the changes in the...
We live in an open economy with international capital mobility If Bank of Canada increases the...
We live in an open economy with international capital mobility If Bank of Canada increases the money supply would that make Canadian bonds attractive to foreigners or not? Explain. Increasing the money supply would lead to the appreciation of the Canadian dollar. True or false? Explain Based on your answer to “b” above, what will happen to net exports?  Explain Ignoring what Bank of Canada did, assume that the Federal Reserve (the US Central Bank) increases the US money supply what...
We live in an open economy with international capital mobility If Bank of Canada increases the...
We live in an open economy with international capital mobility If Bank of Canada increases the money supply would that make Canadian bonds attractive to foreigners or not? Explain. Increasing the money supply would lead to the appreciation of the Canadian dollar. True or false? Explain Based on your answer to “b” above, what will happen to net exports? Explain Ignoring what Bank of Canada did, assume that the Federal Reserve (the US Central Bank) increases the US money supply...
Why did the 2007 U.S. subprime crisis spread rapidly? A. The United States had a large...
Why did the 2007 U.S. subprime crisis spread rapidly? A. The United States had a large current account surplus. B. The United States adopted the fixed exchange rate system. C. There was speculation against the U.S. dollar. D. Banks in other countries failed to measure the risk of real estate derivatives. E. The Fed failed to act at the right time.
Please answer the following 5 multiple choice questions In a small open economy, when foreign governments...
Please answer the following 5 multiple choice questions In a small open economy, when foreign governments reduce national saving in their countries, the equilibrium real exchange rate (measured in units of the home currency divided by units of foreign currency): A.rises, and home country net exports rise. B.falls, and home country net exports rise. C.rises, and home country net exports fall. D.falls, and home country net exports fall. Compared to typical open-market operations, when engaging in quantitative easing operations conducted...
Assume the United States has the following​ import/export volumes and prices. It undertakes a major​ "devaluation"...
Assume the United States has the following​ import/export volumes and prices. It undertakes a major​ "devaluation" of the​ dollar, say 19% on average against all major trading partner currencies. What is the​ pre-devaluation and​ post-devaluation trade​ balance? Initial spot exchange rate, $/fc 2.13 Price of exports, dollars ($) 19.5600 Price of imports, foreign currency (fc) 10.5000 Quantity of exports, units 140 Quantity of imports, units 160 Percentage devaluation of the dollar 19.00
1a. The nominal exchange rate between the United States dollar and the Japanese yen is which...
1a. The nominal exchange rate between the United States dollar and the Japanese yen is which of the following? -The reciprocal of the real exchange rate -The rate at which one of the currencies can be converted into the other currency -Always equal to the real effective exchange rate except when nominal interest rates within the two countries diverge -Always equal to the real effective exchange rate except when real interest rates within the two countries diverge b. If German...
If the value of the US dollar increases relative to other currencies (exchange rate increases), what...
If the value of the US dollar increases relative to other currencies (exchange rate increases), what will be the effect on net exports for the United States?