1. D What issues or factors should a central bank consider as to whether to use the money supply as its primarylexogenou

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1 D What Issues Or Factors Should A Central Bank Consider As To Whether To Use The Money Supply As Its Primarylexogenou 1 (85.02 KiB) Viewed 63 times

1. D What issues or factors should a central bank consider as to whether to use the money supply as its primarylexogenous monetary policy instrument? 11) Compare the contributions of A. C. Pigou, John Maynard Keynes, Milton Friedman and K Wicksell to monetary theory. 2. D With the help of diagrams and or equations, explain what happens to the money supply if the goverment finances a fiscal deficit by (a) selling bonds to the public. (b) selling bonds to the commercial banks. (c) selling bonds to the central bank. (d) selling bonds to foreigners 11) With the help of diagrams and or equations, explain what happens to the money supply if (a) the central bank lowers the discount rate and also sells bonds to the public. (b) the central bank forbids overnight loans and eliminates the overnight loan market. (c) the economy enters a boom, and interest rates rise. (d) the underground economy with illegal holdings of currency is eliminated (e) credit cards are replaced totally by debit cards