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- To depreciate the currency thereby "possibly" improving the current account deficit.
- To drive down interest rate so that it's easier for investors/consumers to borrow i.e. stimulate the industry.
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Which of these can affect the economy by increasing or decreasing the money supply?
The Federal Reserve Board can affect the economy by increasing or decreasing the money supply.
How does the Fed increase the money supply when it buys bonds?
When it buy bonds- that money goes into the economy hence increasing the money supply
Which of these government policies pursues the economic goal equity?
Providing welfare benefits -apex
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.
A long-run effect of increasing the money supply can be inflation?
true
Which of these can affect the economy by increasing or decreasing the money supply?
The Federal Reserve Board can affect the economy by increasing or decreasing the money supply.
How does the Fed increase the money supply when it buys bonds?
When it buy bonds- that money goes into the economy hence increasing the money supply
Which of these government policies pursues the economic goal equity?
Providing welfare benefits -apex
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.
A long-run effect of increasing the money supply can be inflation?
true
What government policies pursue the economic goal of growth?
Increasing the money supplyapex ;PAngelIncreasing the money supply
How increasing the money supply affects interest rates?
In general, increasing the money supply will decrease interest rates. Intrest rates reflect the amount paid for the use of money. As the money supply increases, money becomes relatively less scarce and easier to obtain. As with any other good as the supply increases, while demand remains constant, the price will fall. In this case the price of money is the interest rate.
What political party was in favor for increasing the money supply in the late 1800s?
I think it was the political party.
What is the decreasing or increasing of the economy's supply of money in order to achieve positive outcomes?
Monetary Policy
Are there other tools used by the feds to increase money supply?
The Federal Reserve (or Fed) increases the money supply by buying back outstanding U.S. Gov't Securities (bonds and such). By doing so, they are adding more currency into the economy, thus increasing the supply of money, or money supply. Conversely, the Fed can also lower the money supply. To do so, they simply sell U.S. Gov't Securities. This means that they sell bonds out and bring currency in, thus reducing the money supply.
Increasing the money supply involves which type of economic policy?
An economic policy of enhancing growth, especially in exports will increase the money supply. This can be measured from recent economic history. The last thing, or shall I say an increase in taxes will de-stimulate the growth of the money supply. Another negative would be to increase the money supply by fiat, or in other words "printing it"
What creates inflation?
Milton Freedman probably is the best person to look up for this answer, and he has written much on this topic. Basically it is a monetary phenomina. Increases and decreases in the money supply create inflation or deflation. Think of the root form of this word, inflate, such as a balloon or a tire. Increasing the quantity of a price does not make sense, however rising prices due to increasing the quantity of money in the money supply does.
