1951 treasury federal reserve accord eco 202 monetary

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1951 Treasury-Federal Reserve Accord
ECO 202 Monetary Policy Action: Increase interest rates Intended effects: Decrease expected inflation increased interest rates curtail spending, which slows the economy and decreases inflation This will cause a shift in the aggregate demand from ADI to ADII. Shifts FIGURE NINE: FreeEconHelp, Aggregate Demand Shifts
ECO 202 Monetary Policy Impact- Did it Work? Not Quite. Inflation was not as bad as expected Interest rates were still increased to combat the inflation Demand-driven recession FIGURE TEN: FEDERAL FUNDS RATE AND EXPECTED INFLATION, Romer & Romer. Retrieved from
ECO 202 What Caused the Economic Boom of the 50s? End of WWII & the GI Bill Housing boom, baby boom, creation of suburbs Rise of consumerism and credit spending Average of 5% GDP growth Interstate Highway Act & GI Bill Average unemployment rate of 4% Marshall Plan & GATT/WTO Increased trade- Average trade surplus of 1% of GDP Wars & Recessions Revenue acts to fund wars Struggles to control inflation Creation of the Treasury-Federal Reserve Accord
ECO 202 “Agree/Disagree” GI Bill Interstate Highway Act Increasing interest rates Revenue Act of 1950
ECO 202 References Amadeo, K. (2019, February 28). Compare Today's Unemployment with the Past. Retrieved from - year-3305506 Blas, E. (2010). The Dwight D. Eisenhower National System of Interstate and Defense Highways: The Road to Success? The History Teacher, 44 (1), 127- 142. Retrieved from Bureau of Labor Statistics. (2018, April 13). Consumer Price Index Frequently Asked Questions. Retrieved from Question_11 FDIC. (2014, January 2). The 1940s. Retrieved from ml Hetzel, R. L. (2013, November 22). From WWII to the Treasury-Fed Accord. Retrieved from _the_treasury_fed_accord Hilinksi, C. (1951). Some Comments on the Revenue Act of 1950.

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