Ineffectiveness of Fiscal and Monetary Policy on Long-Run Economic Growth
In the long run, demand-side policies such as fiscal and monetary interventions are unable to alter an economy's fundamental growth rate. This long-term growth is instead dictated by supply-side factors.
0
1
Tags
Economics
Economy
Introduction to Macroeconomics Course
Ch.5 Macroeconomic policy: Inflation and unemployment - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
CORE Econ
Social Science
Empirical Science
Science
Related
Ineffectiveness of Fiscal and Monetary Policy on Long-Run Economic Growth
A country's central bank is establishing its primary objectives for the next 20 years. It is considering two main long-term goals: (1) maintaining an average inflation rate of 2% per year, and (2) ensuring an average real economic output growth rate of 4% per year. Based on the typical long-run capabilities of a central bank, which of the following statements most accurately analyzes the feasibility of these goals?
Policymaker Debate on Long-Term Economic Goals
Evaluating a Nation's Long-Term Economic Strategy
Long-Run Policy Effectiveness
Learn After
Evaluating a Long-Term Economic Growth Strategy
A country's central bank permanently increases the rate of money supply growth in an attempt to create a higher rate of long-run economic growth. Based on the factors that determine an economy's long-term potential, what is the most likely outcome of this policy?
Analysis of Demand-Side Policies for Long-Run Growth
A government's decision to permanently increase its budget deficit to fund new infrastructure projects will guarantee a higher rate of economic growth in the long run.
Match each economic policy with its most likely long-run effect on the economy.