Question and answer
Currently, what indictors are evident that there is too much or too little money within the economy? How is monetary policy aiming to adjust this?
Inflation, fiscal, and monetary policies are good indications. If inflation is high, the money supply in circulating with greater injections than leakages. [ Government policies of interest rates and taxation (monetary and fiscal policy) are good indications of attempted government intervention to control the amount of money available on the market/ floating. ]
Get an answer
Original conversation
User: Currently, what indictors are evident that there is too much or too little money within the economy? How is monetary policy aiming to adjust this?

Weegy: Inflation, fiscal, and monetary policies are good indications. If inflation is high, the money supply in circulating with greater injections than leakages. [ Government policies of interest rates and taxation (monetary and fiscal policy) are good indications of attempted government intervention to control the amount of money available on the market/ floating. ]



User: How does monetary policy aim to avoid inflation?

Weegy: Monetary policy is the control of interest rates. [ The market psychology states that high interest rates will encourage savings rather than spending as one can earn more by depositing money in the bank and it is more expensive to take out loans in comparison to low interest rates. When inflation is high, interest rates will be raised to curb consumption. Inflation is usually the result of aggregate demand surpassing aggregate supply. With the limited amount of resources available, the supply for all goods and services are limited. When AD supasses AS, the price increases rapidly, which leads to high inflation. High interest rates discourage spending as taking out loans are more costly. This will lower the aggregate demand and eventually return the AD and AS to the equilibrium point or the comfort zone. ]



Question
Asked 6/27/2012 8:48:04 AM
0 Answers/Comments
New answers
Rating

There are no new answers.

Comments

There are no comments.

Add an answer or comment
Log in or sign up first.
Questions asked by the same visitor
The market where business sell goods and services to households and the government is called? User: What does Underemployment mean? User: What is the Bureau of Economic Analysis responsible for? User: Federal Reserve provides what info?
Weegy: The Federal Reserve System (also known as the Federal Reserve, and informally as the Fed) is the central banking system of the United States. [ It was created on December 23, 1913 with the enactment of the Federal Reserve Act, largely in response to a series of financial panics, particularly a severe panic in 1907[2][3][4][5][6][7]. Over time, the roles and responsibilities of the Federal Reserve System have expanded and its structure has evolved.[3][8] Events such as the Great Depression were major factors leading to changes in the system. ] User: The Federal Reserve provides which of the following data? A. Federal funds rate B. Stock price of GE C. Bond yields of corporations D. Debt to GDP of Ireland Weegy: A. Federal funds rate User: Consider if the government instituted a 10 percent income tax surcharge. In terms of the AS/AD model, this change should have A. shifted the AD curve to the left B. shifted the AD curve to the right C. made the AD curve flatter D. made the AD curve steeper Weegy: It all depends on what the government does with the money. If it spends it in addition to everything it is already spending, then, to first order, there is no change in the aggregate demand or aggregate supply curves. [ In reality, there is a second order effect associated with the spending multiplier for the government vs. the spending multiplier for the private sector. If the government "destroyed" the money, either literally or using it to replace borrowing, then that would affect both the aggregate demand and aggregate supply curves (changes in money supply affect everyone.) This probably isn't the answer you wanted, but then, you didn't say what context you were using this model in. I tend to think in terms of the real economy and macroeconomics. Most student think in terms of their current course, without reference to reality or the rest of economics, and I don't know what course you are taking. ] User: ... (More)
Question
Expert Answered
Asked 6/26/2012 1:17:22 PM
0 Answers/Comments
The largest source of household income in the U.S. is obtained from A. stock dividends B. wages and salaries C. interest earnings D. rental income
Weegy: The answer is B. wages and salaries. User: The market where business sell goods and services to households and the government is called the A. goods market B. factor market C. capital market D. money market User: Real gross domestic product is best defined as A. the market value of intermediate goods and services produced in an economy, including exports B. all goods and services produced in an economy, stated in the prices of a given year and multiplied by quantity C. the market value of all final goods and services produced in an economy, stated in the prices of a given year D. the market value of goods and services produced in an economy, stated in current-year prices Weegy: c. The market value of all final goods and services produced in an economy stated in the prices of a given year. User: The Federal Reserve provides which of the following data? A. Federal funds rate B. Stock price of GE C. Bond yields of corporations D. Debt to GDP of Ireland Weegy: A. Federal funds rate User: If the depreciation of a country's currency increases its aggregate expenditures by 20, the AD curve will A. shift right by more than 20 B. shift right by less than 20 C. shift right by exactly 20 D. not shift at all Weegy: A. shift right by more than 20 User: Aggregate demand management policies are designed most directly to A. minimize unemployment B. minimize inflation C. control the aggregate level of spending in the economy D. prevent budget deficits or surpluses Weegy: D. prevent budget deficits or surpluses User: Suppose that consumer spending is expected to decrease in the near future. If output is at potential output, which of the following policies is most appropriate according to the AS/AD model? A. An increase in government spending B. An increase in taxes C. A reduction in government spending D. No change in taxes or government spending Weegy: B. An ... (More)
Question
Expert Answered
Asked 6/26/2012 1:39:43 PM
0 Answers/Comments
What are the factors that would influence the Federal Reserve in adjusting the discount rate?
Weegy: The largest autonomous factor is Federal Reserve notes. [ By conducting open market operations, imposing reserve requirements, permitting depository institutions to hold contractual clearing balances, and extending credit through its discount window facility, the Federal Reserve exercises considerable control over the demand for and supply of Federal Reserve balances and the federal funds rate. Through its control of the federal funds rate, the Federal Reserve is able to foster financial and monetary conditions consistent with its monetary policy objectives. I hope this helps! Thanks and have a great day! [smile] ] (More)
Question
Expert Answered
Asked 6/26/2012 2:51:34 PM
0 Answers/Comments
How does a stimulus program (through the money multiplier) affect the money supply?
Weegy: It doesnt give way to inflation (More)
Question
Expert Answered
Asked 6/27/2012 7:52:10 AM
0 Answers/Comments
18,781,346 questions answered
Popular Conversations
Identify the subjunctive verb in the sentences below. I don't know ...
Weegy: I don't know the answer. I wish I knew it. WISH is the subjunctive verb in the sentence.
12/17/2014 6:09:48 PM| 3 Answers
Which of the following does not provide evidence that continents ...
Weegy: B. The existence of glacial grooves does not provide evidence that continents move. User: The most ...
12/18/2014 12:29:01 PM| 3 Answers
When you're creating garnishes, which of the following is the most ...
Weegy: Cucumber will do, but also you can use other fruits and vegetables too like watermelon, carrots, Red bell ...
12/17/2014 12:42:27 AM| 2 Answers
t Object]User: Poverty threshold is an income level above which ...
Weegy: ... then of the Social Security Administration- determines which households have insufficient ... income is ...
12/17/2014 5:44:53 AM| 2 Answers
Given the points A(0, 0), B(e, f), C(0, e) and D(f, 0), determine if ...
Weegy: Please clarify your question. User: Indicate in standard form the equation of the line passing through the ...
12/17/2014 11:42:53 AM| 2 Answers
Weegy Stuff
S
L
P
Points 1001 [Total 4845]| Ratings 0| Comments 1001| Invitations 0|Offline
S
L
Points 629 [Total 1320]| Ratings 1| Comments 619| Invitations 0|Offline
S
Points 624 [Total 624]| Ratings 1| Comments 614| Invitations 0|Offline
S
1
L
1
L
P
P
L
P
Points 617 [Total 14802]| Ratings 0| Comments 617| Invitations 0|Offline
S
P
C
L
P
L
1
Points 88 [Total 6407]| Ratings 1| Comments 78| Invitations 0|Offline
S
L
Points 64 [Total 1524]| Ratings 1| Comments 54| Invitations 0|Offline
S
1
L
L
Points 33 [Total 6700]| Ratings 0| Comments 33| Invitations 0|Offline
S
Points 23 [Total 29]| Ratings 0| Comments 23| Invitations 0|Offline
S
Points 22 [Total 22]| Ratings 0| Comments 2| Invitations 2|Offline
S
Points 21 [Total 21]| Ratings 0| Comments 21| Invitations 0|Offline
Home | Contact | Blog | About | Terms | Privacy | Social | ©2014 Purple Inc.