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What is expansionary mode?
Expansionary mode is the growth of the economy during a recession
Expansionary fiscal policy?
is a policy that have no demand
How does increasing money supply affect expansionary monetary policy?
Expansionary Monetary Policy is adopted by the monetary authorities to increase the money supply of an economy. If money supply is increasing, and central bank adopts an expansionary monetary policy, it would result in inflationary pressures.
What is the purpose of expansionary policy?
increase gvt exp
How does a expansionary monetary policy affect the interest rate overall price level and GDP?
expansionary monetary policy increases money supply by lowering interest rates
What is the definition of expansionary gap?
An expansionary gap is a negative output gap, which occurs when actual output is higher than potential output.
What do you refer to when actual output is higher than potential output?
expansionary output gap has occured.
What does a contractionary gap imply about the actual rate of unemployment relative to the natural rate of unemployment?
Assume certeris paribus, an expansionary gap is where real GDP is above the full employment, and a contractionary gap is where real GDP is below the full employment.
Why does the government sometimes use an expansionary fiscal policy?
to encourage growth and try to stop or prevent a recession
What is expansionary mode?
Expansionary mode is the growth of the economy during a recession
Who determines the expansionary period?
The fed
Why would an expansionary gap lead to a change in inflation Why would a recessionary gap lead to a change in inflation?
Assuming that the aggregate demand curve does not move, the only way for the gap to be closed is by a shift in aggregate supply. These gaps cause a change in inflation expectations, moving the AS curve left (exp) or right (rec) back to long term equilibrium and changing the inflation rate.
Expansionary fiscal policy?
is a policy that have no demand
How does increasing money supply affect expansionary monetary policy?
Expansionary Monetary Policy is adopted by the monetary authorities to increase the money supply of an economy. If money supply is increasing, and central bank adopts an expansionary monetary policy, it would result in inflationary pressures.
What is the purpose of expansionary policy?
increase gvt exp
How does a expansionary monetary policy affect the interest rate overall price level and GDP?
expansionary monetary policy increases money supply by lowering interest rates
What is expansionary policies?
Expansionary fiscal policy is an increase in government spending or a reducing in net taxes which increase aggregate output/income (Y). +G or -T = +Y
