Chapter 14 Review Questions

Chapter 14 Review Questions - Make a list of the...

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Chapter 14 Review Questions 3/23/06 6) Do policy measures aimed at alleviating one set of economic problems sometimes make others worse? Should a policy action be undertaken to aid one aspect of the macroeconomy to the detriment of another? Yes, sometimes by trying to help out one problem, another is made worse. An example could be if the government sets fiscal policy encouraging economic growth. This will help raise the GDP, which is good for the economy, however if the growth is too fast, there will be labor and input shortages, driving up prices, which is bad for the economy. As to whether a policy should be undertaken to help one aspect and hurt another, you must decide which causes the greater good for the macroeconomy as a whole. If more people receive greater benefits from one action as opposed to another, that action should be undertaken. 7) Examine a daily newspaper (e.g., the New York Times) for a few days, and see how many articles address macroeconomic issues and problems.
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Unformatted text preview: Make a list of the macroeconomic terms, concepts, and issues that you find. Article in New York Times about how jobless claims have fallen this week, indicating an increase in the demand for labor and saying that it is very good for the economy. Article titled “Jobless Claims Fall, More Job Growth Seen.” Article in New York Times about how prices for wholesale goods dropped in February, but the costs of the goods increased. This is not good for the economy, and leads to the possibility of higher inflation to come later in the year. Article titled “A 3 rd Rise in Core Wholesale Prices Spurs Concern Over Inflation.” Article in New York Times about how Bernanke agrees with the view that some of the United States economic issues must be addressed by focusing not only on the US, but on the world economy, something that hasn’t been done as much in the past. Article titled “Global View is Backed by Fed Chief.”...
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This note was uploaded on 04/20/2008 for the course ECON 103 taught by Professor Shackelford during the Spring '08 term at Bucknell.

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