Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Microeconomics Expert

Suppose in a country the real growth rate is 4% and the real interest rate is 6%.

(a) find out the constant debt-GDP ratio that the country can achieve if the country runs a primary budget deficit of 3%. Is this debt-GDP ratio stable, i.e., if the debt changes slightly the debt- GDP ratio gravitates towards this constant ratio or the debt- ratio increases or decreases without a limit? describe using appropriate calculations and a graph.
(b) Now suppose the country runs an austerity program and begins to maintain a primary surplus of 2%. find out the constant debt-GDP ratio that the country can achieve. Is this debt-GDP ratio stable? describe using appropriate calculations and a graph.
(ii) Now suppose the country follows an expansionary monetary policy that lowers the real interest to 2%, while real growth rate remains at 4%.
(c) find out the constant debt-GDP ratio that the country can achieve if the country runs a primary budget deficit of 3%. Is this debt-GDP ratio stable? describe using appropriate calculations and a graph.
(d) Now suppose the country begins to maintain a primary surplus of 2% after pursuing a stringent fiscal policy. Now, find out the constant debt- GDP ratio that the country can achieve. Is this debt-GDP ratio stable? describe using appropriate calculations and a graph.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M940173

Have any Question? 


Related Questions in Microeconomics

Create the demand and supply of the labor market and demand

Create the demand and supply of the labor market and demand and supply of the goods market using the production function and consumption utility function given. Solving the equations and graphing the models have to be th ...

Short answer amp essay questionsyou must complete two short

Short Answer & Essay Questions You must complete two Short answer questions and one Essay question All answers must be in the form of a paragraph (minimum of 5 sentences per paragraph). Please select from below: Short An ...

Instruction please answer all questions all questions carry

Instruction: Please answer ALL questions. All questions carry equal marks. Please do not write over 2000 words for the entire assignment. 1. a. Using the graph shown, analyze the effect a $300 price ceiling would have on ...

Assignment multiyear plans and Assignment: Multiyear Plans and Analysis Preparation •

Assignment: Multiyear Plans and Analysis Preparation • Review the document titled "City of Charlottesville 2010 Annual Comprehensive Plan" located in the course shell. Write a three to four (3-4) page paper in which you: ...

Introduction to economic evaluation of health promotion

Introduction to Economic Evaluation of Health Promotion Interventions Assignment Evaluating Cost-effectiveness using Markov cohort models: The HPV case The goal of this assignment is to provide students with applied prac ...

Application evaluation of research resultsno research

Application: Evaluation of Research Results No research project or study is perfect. Studies that contain errors can produce unreliable or misleading results. As a consumer of research, you must be able to determine the ...

Iowa elevatorsresponses will be in a compact format the

Iowa Elevators Responses will be in a compact format. The content of the papers should not exceed three pages in length, excluding the title page, executive summary, or any references. Title Page: Executive Summary: Give ...

Description of assignmentreport paper basisstudents work

Description of Assignment: Report Paper basis. Students work together to research and profile a particular in Microeconomic policy: the property tax in the United States. Grading Criteria (What constitutes a good assignm ...

Microeconomicswatch this 30 mins youtube link on how the

Microeconomics Watch this 30 mins. YouTube link on 'How The Economic Machine Works' You will enjoy it! https://youtu.be/PHe0bXAIuk0 Write down your understanding of 'How The Economic Machine Works' and make sure to suppo ...

Assignmentoverviewthe incidence of fraud in the news has

Assignment Overview The incidence of fraud in the news has become more common in recent years. As the accounting profession becomes more aware of fraud schemes, it seems that the criminals who perpetrate them have become ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro