Gillespie (2010) describes fiscal policies as ‘changes in government spending, and the taxation and benefit system, to affect aggregate supply and demand in the economy’. On the other hand, monetary policies focus more on ‘interest rates and control over the amount of money in the economy’ to influence consumer spending and aggregate demand (AD). During the recession in 2008-9, the UK government used quantitative easing as part of the monetary policy. (Please see appendix 2) This was to increase the money within the banks for lending with an overall aim to increase aggregate demand. Governments’ perspectives differ in terms of the effectiveness of these two policies but in order to see how these policies affect business operations we can look at Tata Steel as an example and the steel industry in which it operates. In order to find a balance, governments may decide to employ elements of both fiscal and monetary…
“Fiscal” means refers to government efforts to influence the economy through taxation and spending and “monetary policy” means Federal Reserve decisions that shape the economy by influencing interest rates and the supply of money.…
Powers, S. (2014, March 15). Fiscal policy and Monetary Policy. Retrieved December 6, 2014, from Small Business: http://smallbusiness.chron.com/explainin-difference-between fiscal-policy-monetary-policy-3873.html…
Fiscal policies refer to government efforts to influence the economy through taxation without representation and spending decisions that are designed to encourage growth. Monetary policies refer to actions that shape the economy by influencing interest rates and the supply of money. Politics plays a role by making taxes higher and by influencing interest rates.…
The definition of fiscal policy is government’s revenue (taxation) and spending policy designed to (1) counter economic cycles in order to achieve lower unemployment, (2) achieve low or no inflation, and (3) achieve sustained but controlled economic growth. (businessdictionarey.com 2013). The definition of monetary policy is economic strategy chosen by a government in deciding expansion or contraction in the country 's money-supply. Applied usually through the central bank, a monetary policy employs three major tools: (1) buying or selling national debt, (2) changing credit restrictions, and (3) changing the interest rates by changing reserve requirements.. (businessdictionary.com 2013).…
As an economics training book, Cocktail Party Economics highlights the concepts of economics, bringing them to light in a simple way without taking away from the importance of each theory and thought. This is a book written to engage its readers and interest them in the idea of the economic thought process. Addressed to “students everywhere, especially those who like economics … or want to,” this book is exactly that. Cocktail Party Economics is a skillful portrayal of the process of economic thought, which entertains young readers due to the author’s sometimes silly and sarcastic moments. Economics may sometimes appear to be a difficult subject filled with elaborate terms and descriptions hard to grasp the understanding of, yet the book brings the subject to life and turns it into a less complex compilation of concepts in a cocktail party setting.…
Cocktail Party Economics is a well written text, composed in a conversational style text, which turns big ideas into small talk. Eveline J. Admoait and Richard G. Maranta provide an interesting take on their view of the economic world. The text takes complex economic ideas and enables readers with no previous background of economics to comprehend the ideas being exemplified. Admoait and Maranta also make the book easily relatable because they use real life examples that can be applicable in day to day life. The style and witty humor throughout the text not only make it easy to read but also extremely enjoyable.…
This Friday evening I am hosting a dinner party at my house. There will not be a long list of people attending this dinner party, only three people that I am interested in learning more about, and getting to know personally. The three people that will be attending this dinner party are Elie Wiesel, Abraham Lincoln, Martin Luther King, Jr. Since these are all very different and historical people, there are several reasons as to why I am having them attend my dinner party.…
There are many monetary policy used my the Federal Reserce in each country. But the most commone one is open market, the discount rate and the reserve requirement. In the open market policy, the governmetn does not interfer in the money market. Instead the power of market such as supply and demand will have a great role in controlling the market. The other one is the discount rate which is fixed by the federal reserves. This monetary policy will control the value of money and its circulation in the…
Monetary policy is the decisions a government makes to control the supply of money, availability of money, and value of money.…
According to Keynesian methodology, there are two powerful tools the government and The Bank of Canada can employ to direct the economy in a positive direction: fiscal and monetary policy. Both policies, when used correctly, can be employed to stimulate the economy during times of recession or slow down the economy during times of inflation. The effectiveness of government intervention in the economy in the long and short run through fiscal and monetary policy has been the subject of controversy among many economists. Fiscal policy is concerned with adjusting government spending levels and tax rates in order to influence the Canadian economy in such a way that it stimulates or slows down economic growth. Monetary policy is governed by the Central…
In the novel Dinner Party Economics written by Evie Adomait and Richard Maranta, the complex topics of macroeconomic policy and its relation to current world economic debates are explored. This paper will discuss my opinion of unemployment, oil prices and international trade opportunities as well as the current conditions of the Canadian economy. In December 2016, Canada added more than 50,000 jobs, making 2016 the best year for job creation since 20121.…
The fiscal policy is referred to the government decision on adjusting the spending levels, imposing taxes, and curbing inflation rates and boosting employment rate in the nation’s economy (‘ What is Fiscal Policy,” 2013). The monetary policy is controlled by the Federal Reserve System; the feds lower interest rates and increase the money supply (Kelly M. , 2012). The main goals of these policies are to control and promote growth in the economy. Every year the government meets to create a budget from the revenue received from taxes and fees to outline spending by the government. The government controls spending and increase taxes to get money out of the economy. The current fiscal policy could have negative affect that are not the same for everyone and may only affect the middle class, meaning they must pay higher taxes than the wealthier class of people(”Effect of Monetary…
It is December 31st, 1914, just a couple more hours until the New Year. The loud sound of cars and taxis honking could be heard from all over. Times Square was as vibrant as ever during this time of the year with its streets and buildings all still lined up with Christmas and winter decorations. The window displays of department stores showcased their after-Christmas sale specials. However, some stores were thinking ahead and already had Valentine’s Day displays out on their windows. Shoppers, tourists, and families crowded the streets on every block in anticipation for the glorious ball drop in Times Square. However, the real party, was just some blocks away at the Grand Time Traveler’s…
Have you ever had an argument in which you just wanted to punch the adversary right in the face? Well, that's just about how a young girl felt in the fascinating fictional story written by Mina Gardner, The Dinner Party. The main message of this story is that any female can be just as equal as any male. In this story, a young girl brings up a thought provoking topic. She believed that women are perfectly equal as men. But as any other story she faces objection. To prove her point correct, the author shows us an example of Mrs. Wynnes, the hostess of the dinner party, realizing that there is a cobra under the dinner table, and taking control of the preposterous situation calmly. The colonel, who opposed the young girl's thought, was traumatized…