THE RELATIONSHIP BETWEEN the expected rate of change of prices and the level of interest rates enjoys special status in economic theory. The positive relationship hypothesized long ago by Irving Fisher is widely accepted by students of economic theory, while its existence for United States experiences...
With respect to the interest rate, a. what is the liquidity effect? b. what is the price-level effect? c. what is the expectations effect? With respect to the interest rate, what is the liquidity effect? What is the difference between the nominal rate of interest and the real ...
What is the short-run and long-run effect of an increase in nominal interest rate on the inflation rate? When there is a permanent decrease in money supply growth, real interest rate and real output remain constant. What will happen to the price level? What happens to th...
In effect, some of the tax burden was being shifted to taxpayers in sensible states, such as Florida and Texas. That’s bad, but here’s something that may be even worse. 2. Another terrible idea in Washington is to impose price controls on credit card interest rates. Financial companies...
By allowing inflation that is “higher than 2 percent for a time,” inflation-adjusted short-term interest rates would fall, presumably moving real interest rate close to their market-clearing levels. President Evans contemplates implementing the price-level targeting approach for “the duration of ...
metals producers raised prices as companies tried to buy before the tariffs went into effect, Nagle said. He said steel prices are up 25 percent since the tariffs began, and he expects that to rise to near 30 percent next year. Automakers would either raise sticker prices or cut di...
Chapter12Pricelevelsandexchangerateinthelongrun 2 TheLawofOnePrice Lawofoneprice（一价定律）Identicalgoodssoldindifferentcountriesmustsellforthesamepricewhentheirpricesareexpressedintermsofthesamecurrency.Thislawappliesonlyincompetitivemarketsfreeoftransportcostsandofficialbarrierstotrade.Example:Ifthedollar/pound...
11.Analysis on Influence Factors of Domestic Styrene Price and Styrene Price Forecast;国内苯乙烯价格的影响因素分析与价格预测 12.The Effect of Price and Quality on Consumers Perception of Fairness;价格与质量关系对价格公平知觉的影响 13.Impact of Energy Price Increase on General Price Level in China:...
A homeowner has a $50,000 fixed-rate mortgage on his home. Would you expect him to be hurt by an increase in the inflation rate from 3% to 6%? Explain. What is the effect of a tight monetary policy on interest rates, price level changes (inflation), and home price changes?
Exchange rate between countries’ currencies equals the ratio of the countries’ price levels. The price level, we know, is the money price of a reference basket of goods and services €E$/€=PUS/PE €PUS=(E$/€)×(PE) There is a assumption that the basket is identical between countrie...