Macroeconomics
IS-LM Basics
A) The IS curve slopes downward and to the right.
B) The LM curve slopes upward and to the right.
C) The slope of the LM curve depends on the interest sensitivity of money demand. An elastic money demand function caused the LM curve to be relatively flat. An inelastic money demand function caused the LM curve to be steep.
D) The slope of the IS curve depends on the slope of the investment function. If investment is highly interest elastic, then the IS curve is relatively flat. If investment is not highly interest elastic, then the IS curve is very steep.
E) The quantity of money and shifts in money demand at given levels of income and interest rates will shift the position of the LM curve.
F) Government expenditures, tax increases, and autonomous investment expenditures shift the position of the IS curve.
Transaction Demand – Money is a medium of exchange and individuals hold money for use in transactions. Money bridges the gap between the receipt of income and eventual expenditures.
Precautionary Demand – Keynes believed that, in addition to the money people held for planned transactions, more money was held for unexpected expenditures that were at times necessary. Money would be held for emergencies, to pay unexpected medical bills or repair bills of various types.
Speculative Demand – Money held by those speculating on future changes in the interest rate and the relationship the interest rate had with the level of bond prices.
Keynes’ Money Demand Function
Md = Co + (C1 x Y) + (C2 x R) , C1 * 0 , C2 * 0
A rise in income increases money demand, a rise in the interest rate leads to a fill in money demand.
Md = Money Demand
Y = Income
R = Interest Rate
C = Parameter (Holds no economic value)
Transaction Demand - Dependent positively on the level of income.
Precautionary Demand - Keynes believed that the amount of money held for this purpose depends positively on income. The interest rate might be a factor if people tended to economize on the amount of money held for the precautionary motive as interest rates rose.
Setting the rate of interest (i) creates a horizontal LM curve, setting the money supply (M) has a sloped LM curve. This is illustrated in the diagrams below:
...g by; First, I would make sure that their is plenty of feedback for the employees. As our text suggests, "Without feedback, learning can not occur"(Crandall, W., Parnell, J. & Spillan, J. (2013). Secondly, I would make sure that I have a great crisis management team that are well trained and drilled. Thirdly, we would have a strategy and plan for crisis events. Also, It is very important to make sure that your team members are all confident in their ability to make good decisions for the company. So many times, people are afraid to make decisions. This leads to scapegoating within the departments, and the whole blame game. That doesn't get anybody anywhere.
...re options, and the penalization of millions of Americans who are already on private healthcare plans. Time will reveal whether or not the Affordable Care Act proves a success or a failure.
...come worse off. That is due to the reason that an increase in the level of interest rate leads to a relatively smaller current consumption, since borrowing from the future is not the ideal solution because it has become more expensive than before. Generally for a borrower current consumption always falls while savings rise.
The Affordable Care Act (ACA) is a federal that was signed into law by President Barack Obama on March 23, 2010 to systematically improve, reform, and structure the healthcare system. The ACA’s ultimate goal is to promote the health outcomes of an individual by reducing costs. Previously known as the Patient Protection and Affordable Care Act, the ACA was established in order to increase the superiority, accessibility, and affordability of health insurance. President Obama has indicated the ACA is fully paid for and by staying under the original $900 billion dollar budget; it will be able to provide around 94% of Americans with coverage. In addition, the ACA has implemented that implemented that insurance companies can no longer deny c...
Food can be classified as fast food, junk food, whole food, organic food out of these whole food is unprocessed, unrefined so it has very short shelf life because most foods contain enzymes or natural chemicals, such as acids or alcohols, that cause them to begin to lose characteristics almost immediately after harvest or preparation. In addition, a several of environmental factors, such as heat and the presence of microorganisms, acts to change foodstuffs in ways that may harm the food product so food should be processed to increase its shelf life because food is vital for survival. Food preservation is one of the oldest technologies used by human beings to avoid its spoilage. Different methods have been found and developed for this purpose such as boiling, freezing & refrigeration, pasteurizing, dehydrating, pickling. Some of these are traditional methods. Certain chemical substances are also added into the food to avoid spoilage of food, such substances are called food preservatives.
...urage people to hold more money and less bonds. One way to determine this is that an excess supply of money causes there to be an excess demand for bonds which causes the price of the bonds to rise and thus brings down the interest rate.
(b) Provide an example of how a Central Bank could use monetary policy to achieve
In the graph, it shows the law of demand; as the price increase there is a decrease in the quan...
..., Crisis communication failures: The BP Case Study, International Journal of Advances in Management and Economics, Issue 2, March-April 2013, accessed 28 March 2014,
The crisis team must keep one thing in mind, above all, when anticipating and planning for crises: crises are fraught with risks, which present themselves immediately, and opportunities, which give small clues and only manifest themselves over time.
On the other side, equilibrium in money market is achieved when demand for liquidity (L) equals the supply of money (M).
The communication process is not something that begins when a crisis rears its ugly head rather it is a process that takes place in preparing for a crisis before it happens. While the term crisis represents a blanket term used to describe many situations, each situation is unique, thus presenting different obstacles to overcome. However, with a well-established advanced plan in place an organization places itself in a position to overcome and work around obstacles. The development of a comprehensive crisis management plan is one achieved through effective communication where each member of the crisis management team has an advanced shared understanding of his or her role and responsibility during a time of crisis (du Pr'e, 2005).
The influence of rapidly growing social media, television, and the internet has taken the world by storm in recent years. Its fascinating development over the years is nothing short of remarkable when you take into account that 20 years ago, only 16 million people in the world were "online", compared to the 2 billion that roam on the internet now. Modern communications technology has now become so familiar and utterly banal, yet there is still this tingling sensation when one receives a text from a love interest on Facebook or WhatsApp. Human identity, the idea that defines each and every one of us, is on the verge of being radically defined by social media. This essay will provide a balanced outlook on the positive and negative effects that social media have had on the behaviour and thinking on humans. The topic is a very controversial one, but the purpose of this is to help readers formulate a view on whether the arguments in this essay benefit society in general, or whether they harm the well-being of the human brain and detach us from reality.
Food Preservation is the ways to retain the food quality in a longer times. It is to prevent the food decomposition and fermentation. Besides that, food preservation not only to prevent the food getting spoilt in a long period of time but also preserved the colour, taste and the food nutritive value. Nowadays, food preservation has become more and more important component in the food industry as the consumers expect that able to purchase those foods that are out of season or imported from other countries. Furthermore, there are few reason why food preservation is important in our daily life such as preservation foods when they are in season it may added variety choices in our meals for example smoke meats and