The government attempts to manage the economy's ups and downs through two types of economics policy "fiscal policy and monetary policy. ... Monetary policy is managing the economy by controlling the money supply and interest rates. ... Unlike monetary policy that changes the money supply and influences the spending decisions, government alters its own purchases of goods and services in the fiscal policy; thus, fiscal policy shifts the aggregate-demand curve directly. ... The goal of both fiscal policy and monetary policy is to smooth out the booms and busts of the business cycle so...

• Word Count: 315
• Approx Pages: 1
• Grade Level: Undergraduate

The question being asked is "To what extent should the Canadian Government use it's fiscal and monetary policies to narrow the rich poor gap?" First of all Fiscal policy refers to the government role in collecting taxes and spending money. When using the fiscal policy the government has the ability to increase or decrease the taxes of the citizens. The monetary policy is dealing with the amount of money that is in circulation, which means that the Government can control the amount of money available to the economy. ... These are some ways that the government can use its monetary and fisc...

• Word Count: 867
• Approx Pages: 3
• Grade Level: High School

What is the monetary policy? ... The monetary policy affects the individual, the business, as well as the federal institution. When evaluating the monetary policy for present day economy, the following should be considered: categorization of the state of the economy, concerns of high inflation or possible recession, and the direction of the economy as it relates to the monetary policy. ... Areas of concern revolve around the federal fiscal policy. ... If the monetary policy is executed correctly, the nation's economy has the potential to be strong and soon recover, increasing the value o...

• Word Count: 666
• Approx Pages: 3
• Grade Level: Undergraduate

Since then Canada has utilized reviewed and updated policies to regulate the economy.The fiscal policies are geared towards keeping the goods market stable while the Monetary policies are geared towards keeping the financial markets in equilibrium through the exchange rates, interest rates and money supply. ... David Dodge, Governor of the Bank of Canada to the School of Policy Studies, explained how monetary and fiscal policies in Canada work. ... In summary, monetary policy cannot accommodate for temporary supply shocks too well. Fiscal policy uses government expend...

• Word Count: 398
• Approx Pages: 2
• Grade Level: Undergraduate

Monetary Policy and the Economy Using the tools of monetary policy, the Federal Reserve can affect the volume of money and credit and their price "interest rates. ... GOALS OF MONETARY POLICY Many analysts believe that the central bank should focus primarily on achieving price stability. ... MONETARY POLICY AND THE RESERVES MARKET The initial link between monetary policy and the economy occurs in the market for reserves. The Federal Reserve's policies influence the demand for or supply of reserves at banks and other depository institutions, and through this market, the effects of mon...

• Word Count: 4049
• Approx Pages: 16
• Grade Level: Undergraduate

The International Monetary Fund (IMF) is an international organization that consists of 188 countries working to promote global monetary partnerships, advocate high employment and sustainable economic growth, secure financial stability, reduce poverty around the world, and further international trade. ... IMF examine the economic policies of countries with loan agreements to determine if a shortage of capital was due to economic fluctuations. IMF additionally researched what types of government policy would promise economic recovery. The challenge was to promote and apply a policy that reduce...

• Word Count: 524
• Approx Pages: 2
• Grade Level: Graduate

Argentina's weak fiscal policy and mounting overvaluation creating relatively high inflation, a stronger dollar, insufficient domestic flexibility, and lack of sources of adjustment to maintain competitiveness lead to a second recession. The absence of fiscal policies and the fear that other policies were not strong enough to support the convertibility plan lead to the collapse of the currency board, a plummeting exchange rate, and ballooning debt. ... In December 1999, the government designed an economic program aimed at reaching fiscal balance by 2003. ... By saying "monetary anchor," t...

• Word Count: 1837
• Approx Pages: 7
• Grade Level: Undergraduate

Don't Mix Monetary and Fiscal Policy: Why Return an Old, Flawed Framework? ... As politicians debate how to "spend the surpluses," renewed calls that monetary policy will need to be adjusted to fiscal policy changes represent a replay of monetary/fiscal policy mix framework that has led to macroeconomics policy mistakes in the pas and, if pursued, could again unhinge the foundations for sustained healthy economic expansion. A Flawed Framework- the monetary policy should be adjusted to fiscal policy to achieve desired economic performance; presently suggesting the Federal Reserve will...

• Word Count: 1129
• Approx Pages: 5
• Grade Level: Graduate

Bretton Woods and the International Monetary Fund worked well diverging fiscal and monetary policies and external shocks. ... Also, flexible rates allow the government to be flexible in conducting domestic monetary and fiscal policies. The disadvantages include allowing for speculation to cause large jumps in the exchange rates, which do not reflect market fundamentals, and allowing the government to be flexible in conducting domestic monetary and fiscal policies. ... Fixed rates are inherently anti-inflammatory, requiring the country to follow restrictive monetary and fiscal policies. Fix...

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It issues Federal Reserve Notes, clears checks, acts as a fiscal agent to the federal government, and audits and maintains competition in the banking system. ... After the collapse of Lehman Brothers, the ECB also resulted in unconventional monetary policy, in addition to convention policy, to try and revive the struggling economy. The conventional monetary policy used by the ECB is changes in the interest rates, which was immediately implemented following the collapse of Lehman Brothers. ... The first unconventional monetary policy tool was the fixed-rate full-allotment policy (FRFA). ... Th...

• Word Count: 3183
• Approx Pages: 13
• Has Bibliography
• Grade Level: Undergraduate

To evaluate this, we must look at fiscal policy and the obstacles encountered in policy planning. ... Firstly, they could use expansionary fiscal policy to attain external balance or secondly, they could use contractionary fiscal policy to achieve internal balance. ... This includes both fiscal and monetary policy (fiscal policy referring to changes in government expenditures and taxes), and monetary policy (changes in a nation's money supply, in turn affecting domestic interest rates). ... Policy planners can also move the economy into internal and external balance by shifts in fiscal a...

• Word Count: 1548
• Approx Pages: 6
• Grade Level: Undergraduate

Fiscal Policy, which is controlled by the U.S. ... Most people are more familiar with fiscal policy while many less are familiar with monetary policy and its tools, which are interest rates, reserves, and open market operations. ... Although this paper focuses on US monetary policy, some further discussion of fiscal policy is appropriate because it is the other way that the economy can be controlled. ... Unlike the monetary policy run by the Fed, fiscal policy is carried out by the government, and so politics play a key role in the policy. ... The fiscal policy can also be used as a campaign t...

• Word Count: 2739
• Approx Pages: 11
• Has Bibliography
• Grade Level: High School

Earlier we learned the important of Fiscal Policy and Fiscal Spending to combat inflation. In this unit, we learn that the Federal Reserve is another important player in the government operation to balance out monetary expansion. Through the use of reserve requirement, discount rate, and open market operations, the Fed have the opportunity to dictate the monetary policy. ... Open Market Observation is the most direct method the Federal Reserve has to effect monetary policy. ... The Monetary Policy of the Federal Reserve combined with the governments Fiscal Policy is often what is credited with...

• Word Count: 372
• Approx Pages: 1
• Grade Level: Undergraduate

This emphasis on the budget deficit carried over into the SGP despite the fact that the rationale for the SGP was to safeguard EMU, by providing some elementary coordination of fiscal policy (Artis and Winkler, 1997). ... If the SGP were to be a crude fiscal coordination mechanism constructed as a counterpart to a centraliszed monetary policy, then surely the fixed 3 percent budget deficit limits are not relevant: - a true coordination mechanism would allow fiscal stimulus or contraction relative to some average stimulus that was calculated at the EU level - that is, the EU business cycle...

• Word Count: 1678
• Approx Pages: 7
• Grade Level: Graduate

In the area of monetary policy since 1997 Labour's top priority has been the control of inflation. ... In their first weekend of Government after winning the 1997 election Labour created an Independent Bank Of England and a Monetary Policy Committee made up of the head of the Bank Of England and leading economists, which was given the control of interest rates. ... In the area of fiscal policy in the first two years of the Labour Government they promised to follow lower Conservative spending plans hoping to dispel the myth that Labour could not be trusted with public finances. ... Just ...

• Word Count: 962
• Approx Pages: 4
• Grade Level: Undergraduate

Interest rates are controlled by monetary policy-a set federal funds rate. In addition, almost all fiscal policies have an effect on our GDP. ... Monetary and Fiscal policies should be greatly modified in order for the United States to have an optimal economy. ... Therefore, if government intervention can be minimized, the effects of monetary and fiscal policies can be more controlled and effective. ... Thus, I agree most with classical economics, and believe that monetary and fiscal policies should be almost eliminated in totality....

• Word Count: 454
• Approx Pages: 2
• Has Bibliography
• Grade Level: Undergraduate

Expenditures at the federal and provincial level were simply unstoppable, and since no one was willing to raise the necessary tax revenues to cover costs, Argentina's monetary policy consisted largely of printing money to accommodate the fiscal deficit. The result, not surprisingly, was monetary chaos. The convertibility plan was finally proposed as a way to control the fiscal deficit, not by attacking fiscal mismanagement directly, but rather by removing the ability of monetary policy to accommodate it. By handing over control of Argentina's monetary policy to the US, Argentina...

• Word Count: 708
• Approx Pages: 3
• Grade Level: Undergraduate

To meet these objectives the government must place policies such as fiscal, monetary, trade and income policies. Fiscal policy is the deliberate action of the government to change its levels of income and expenditure, through the annual budget. ... Monetary policy can also raise the level of economic activity. ... Trade policies influence the exchange rate and determines the levels of production for Australian industries. ... Trade policies help the economy by encouraging Australians to buy Australian products. ...

• Word Count: 425
• Approx Pages: 2
• Grade Level: High School

In order to counter the trend, the government and Federal Reserve could use fiscal and monetary policies to intervene the economy. ... The capital account can complicate the monetary policy designed by the federal to reduce money supply in the market. When Fed sells treasure bills in the market, it might attract foreign investment and affect the efficiency of the monetary policy. ... However, when the economy approaches the inflationary window, the government and Federal Reserve should get involved and adopt fiscal and monetary policies to prevent the economy from getting inflated. ... Less t...

• Word Count: 1364
• Approx Pages: 5
• Grade Level: Undergraduate

James Stock and Mark Watson wrote a paper on how the monetary policy has improved the economy. ... They also believe that the monetary policy should lean against the build-up of imbalances even if current inflation is subdued. ... He believes it is safer to wait for a bubble to burst on its own then to try to control the after effect by easing monetary policy. ... The stabilization policy has been used to describe the use of monetary and fiscal policy to smooth business cycle fluctuations. ... Fiscal policy is necessary for monetary policy to pursue both long-term price stability and short t...

• Word Count: 1182
• Approx Pages: 5

Monetary policy is based on two tools. ... The third and the best solution how to increase a living standard of Slovaks is to use a fiscal policy. Fiscal policy is done by government and it is based on two factors. ... Fiscal policy is one of the most using policies in the democratic countries in the world. The basis of fiscal policy was given by J. ...

• Word Count: 1457
• Approx Pages: 6
• Grade Level: High School

The Japanese economic decline of the 1990's can be attributed to several things: poor growth performance, serious fiscal problems, weak labor market conditions, weakening of the trade and external accounts of the country, and excessively loose stance of macroeconomic policies. ... Serious fiscal problems: Large and growing public debt to GDP ratio, in 1992 it was 63% and rose to 89% by 1996. ... Excessively loose stance of macroeconomic policies: Very loose monetary policy to stimulate recovery and save the collapsing banking system and the nominal interest rate was close to zero...

• Word Count: 347
• Approx Pages: 1
• Grade Level: Undergraduate

An important part of this has been the increased efforts by central banks to communicate their views about the economic outlook and its implications for monetary policy. Monetary policy is defined by (Labonte and Makinen, 2008) as the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest to attain a set of objectives. In Australia, The Reserve Bank of Australia (RBA) has been responsible for implementing the monetary policy since 14th January 1960, reported by Reserve bank of Australia (2013). ... As stated by (Rahman and Mohsin, ...

• Word Count: 2454
• Approx Pages: 10
• Has Bibliography
• Grade Level: High School

The International Monetary Fund (IMF), as said in their official website, claims to promote macroeconomic stability and to reduce poverty by giving aid to country members, especially developing nations, facing economic difficulties. It does this by providing advice on jobs and growth, debt sustainability, and financial systems, and work on fiscal policy and employment amongst many. In its annual report for 2013, the IMF presents the wide-array of programs they offer and also addressed the problem of how in a globalized world, lagging policy momentum can affect all. ... The IMF said that its "...

• Word Count: 1443
• Approx Pages: 6
• Has Bibliography
• Grade Level: Undergraduate