Flexible Exchange Rates and Employment Policy |
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Page 509
... foreign trade multiplier . The reason lies in the fact that equilibrium in the balance of payments is automatically main- tained by variations in the price of foreign exchange . These simple truths have already been anticipated in the ...
... foreign trade multiplier . The reason lies in the fact that equilibrium in the balance of payments is automatically main- tained by variations in the price of foreign exchange . These simple truths have already been anticipated in the ...
Page 512
... exchange rate - output complex from any point such as V : it will either proceed ... foreign currency ) would have to fall : this means that the XX schedule ... trade multiplier . The change in output given by the multiplier is y1y2 ...
... exchange rate - output complex from any point such as V : it will either proceed ... foreign currency ) would have to fall : this means that the XX schedule ... trade multiplier . The change in output given by the multiplier is y1y2 ...
Page 513
... foreign trade multiplier plus an additional amount due to the elimination of the foreign imbalance by the depreciation of the exchange rate . Fiscal policy is therefore more effective in improving employment under a system of flexible ...
... foreign trade multiplier plus an additional amount due to the elimination of the foreign imbalance by the depreciation of the exchange rate . Fiscal policy is therefore more effective in improving employment under a system of flexible ...
Common terms and phrases
assume balance of payments capital movements central bank changes commercial policy creates an excess depreciation dynamic system effective under flexible effects of fiscal eliminated employment and output equilibrium exceed the slope excess demand excess supply exchange rate-output complex exports F X FIGURE FF schedule fiscal policy fixed exchange rates flexible exchange rates foreign balance schedule foreign exchange foreign trade multiplier foreign-balance schedule improve employment income expansion increase employment increase in income increase in output increased investment interest rate internal balance schedule internal-balance schedule Keynesian Laursen-and-Metzler leakage through foreign level of employment level of output locus of exchange ment monetary policy multiplier effect Policy on Employment positive slope price of foreign quadrants RATE X F reduce capital imports situation in Figure slope of FF slope of XX spending on home STABILITY CONDITIONS terms of trade Theory of Employment XX curve XX exceed XX line XX schedule θα ах