Macroeconomics assignment! What should the FOMC do?

FratBro23
Category:
Economics
Price: $35 USD

Question description

(http://www.federalreserve.gov/monetarypolicy/fomccalendars.htm).  There is general consensus among economists that there has been some expansion in the business cycle throughout 2014 and 2015. Some sectors of the economy are doing well but other sectors are not. The stock market and housing in some regions are recovering from the Great Recession nicely, but the unemployment rate, although falling slowly, is still relatively high and real wages are not increasing as rapidly as desired. The data is giving conflicting signals, as usual. If we are headed into a sustained economic expansion, low interest rates could be inflationary – and once that gets started, it’s hard to put that genie back in the bottle. Does the Fed want to continue with their stimulatory ("accomodative" in Fed-speak) monetary policy?

Suppose you were a voting member of the Federal Open Market Committee. Would you vote to implement monetary policies that would speed the economy up (to fight unemployment), or slow it down (to fend off potential inflation) -- and why?

In your submission, you'll need to address the following question. What should the Fed decide to do at this meeting?  I’m giving you a lot of latitude in this last Discussion Topic to tell me about the current state of the economy, the proper role of monetary policy (i.e. raise or lower rates), and how effective that would be compared to fiscal policy


Tutor Answer

(Top Tutor) Daniel C.
(997)
School: UC Berkeley
PREMIUM TUTOR
Studypool has helped 1,244,100 students
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1821 tutors are online

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors