When should stimulus programs be appliedSolutionStimulus prog.pdf

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When should descriptive statistics and inferential statistics be used in 250 words or less? Solution Descriptive statistics are used to reveal patterns through the analysis of numeric data. Inferential statistics are used to draw conclusions and make predictions based on the analysis of numeric data..

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When should stimulus programs be applied?
Solution
Stimulus programs are financial packages used by governments (or international agencies like
IMF) to provide booster to an ailing, failing or distressed economy.
A stimulus program usually consists of monetary or fiscal policy measures, and can include bail-
out packages from international agencies.
Such programs are best suited under following situations:
- an economy is under severe economic distress (Either internal, or external like balance of
payments crisis)
- A chronically distressed economy is facing bankruptcy in ability to pay its internal & external
debts, including soverign debts
- It is ascertained that such stimulus program will correct the underlying factors that caused the
crisis, than being merely a superficial generation of ability to pay off debts. Unless the
underlying causes are not addressed & eliminated, the program will not achieve any long term
effect.
- Along with the targeted segment of an economy which the stimulus program attempts to
stimulate, other segments of the economy should simultaneously be made to work toward
achieving the common goal. For example, providing a monetary stimulus in conjunction with a
fiscal policy that has effects opposite to the monetary stimulus, will have no effect. The affected
economy must be willing to ensure this does not take place.

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How do government policies and/or regulations factor into changes in economic activity on both a domestic and global scale? Give a specific example of a policy or regulation that has helped economic activity. Give a specific example of a policy or regulation that has hindered economic activity. If you were an economist who was tasked with evaluating this policy or regulation, what are some ideas you would suggest for changing it in a way that would achieve the same goal but not hinder economic activity? Finally, state whether or not you enjoy these types of evaluations and if you would consider these types of responsibilities in a future career. Solution Monetary policy is by far the most powerful weapon in the government’s arsenal. Unfortunately, it is also the most imprecise. The government can do some fine control with tax policy to move capital between investments by granting favorable tax status On the whole, governments tend to go for large, sweeping changes by altering the monetary landscape. Governments are the only entities that can legally create their respective currencies. Interest rates are another popular weapon, even though they are often used to counteract inflation. They can spur the economy separately from inflation. Pumping in money feels good for a while, especially for investors who see corporate profits and share prices shooting up, but the long-term impact is an erosion of value across the board. Savings are worth less, punishing savers and bond buyers Government programs provide valuable \"public goods\" such as education and infrastructure. Inreases in government spending can bolster economic growth by putting money into people\'s pockets. I believe the policy of QE (quantiative easing) during times of recession to bring back a shattered economy in place. An automatic reversal will never happen, and it is imperative on the part of government is follow such prudent measures. I would consider these types of responsibilites in a long-term perspective. *****.

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Broadly speaking, the economy consists of households, firms, government, and financial institutions. Name two parts, areas, or types of government that can have influence over the economy Solution Explanation: - Financial policy: Monetary Policy of any government can have major impact on economy of a nation since it has the power to stimulate the economy and change the way economy behave. Financial policies are performing major part in economy and it can make or break economy. How the taxes are levied can majorly impact economy. Financial policies move control the flow of the money and it can inject new money flow in system to revive it. - Fiscal Policy: Another major player in stimulating and impacting economy at it best is fiscal policy. Fiscal policy mainly works to overcome from struggling economy and reduce the inflation in market. Interest rate is popular tool to control the flow money through changing interest rates..

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