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Use the information in the following table to calculate Nominal Gross
Domestic Product ( NGDP) for 2015.
4. Why might cutting government spending as a fiscal policy be a
more difficult policy than the use of the monetary policy to slow
down an economy experiencing inflation?
A. The legislative process works quickly
B. The government has more concentrated power than the Fed
C. The economy may have already slowed
D. The Legislative process experiences longer delays than monetary
policy
5. Suppose that Deja owns a McDonald’s franchise. She decides to
move her restaurant’s checking account to Wells Fargo, which
causes the changes shows on the following T-account
Reserves:
-
$100,000
Deposits: $100,000
If the required reserve ratio is 0.05 percent and Wells Fargo currently
has no excess reserves, the maximum loan Wells Fargo can make as a
result of this transaction is
6. (related to solved problem #3) Suppose the information in the
following table is simple economy that produces only the
following four goods; shoes, hamburgers, shirts and cotton. Further,
assume that all of the cotton is used to produce shirts.