Would you use Keynesian Policy?

1. Would you apply Keynesian Policy? pardon Keynesian Economics in 10 lines or less.Keynesian Economics, broadly speaking, is a macro scotch approach that proponents active presidency intervention in a countrys monetary policy in value to construe the best economic outcome. This produces a mixed economy, where both the close sector and the organisation control market conditions.In order to ensure economic growth and stability, judicatures impose policies that could stimulate the economy towards their desired ends. In a recession, stability offer be achieved through tax breaks and government spending in an economic upturn, this feces be through with(p) though tax hikes and cutbacks on government spending. Keynes, the theorys proponent, banks that trends in the macroeconomic level can influence the spending and market behavior of individuals, and that the government plays a decisive part in instigating these trends by adjusting the economys general equilibrium.2. Would yo u use Supply military position Policy? Explain this Economic Policy in 10 lines or less.The emerge-side policy holds that influencing the put out of dangerouss and serve pull up stakes lead to economic health. It emphasizes the supply, kind of than the guide stimulus towards economic activity. Its conjecture is that if individuals have the sum to buy, demand will be created. Supply-side economics thus focuses on policies that raise outturn capabilities for impenetrable the cost of products and controlling rising prices.Supply side economists believe that steep taxes join ons the costs of production, thereby reducing the incentive to work and to invest. As such, they advocate policies that lower taxation gaits in order to raise industry outputs and market capitals.3. Would you use Monetarism? Explain this policy in 10 lines or less.The doctrine of Monetarism places emphasis on controlling the domestic currency supply for promoting growth and importanttaining economi c stability. Monetarists believe that regulating the commonwealthal income is the primary represents for improving economic activity.It holds that instability and market changes such as ostentatiousness atomic number 18 due to fluctuations in the capital supply, specifically, that these changes came as a pull up stakes of the capital supply being larger than the demand. By this assumption, increasing or decreasing the money supply, rather than raising taxes, will keep inflation in check. This is usually done by maintaining price stability and steady increasing the stock of money in a moderate manner.4. Would you use a combination of some or all of the above? Explain their main differences in 16 lines.Among the three macroeconomic policies, I believe a combination of Keynesian and Monetarist approaches will do best in achieving economic growth and stability.According to the theory of Monetarism, inflation is an effect of the supply of money exceeding the demand. As such, regul ating market prices is the best port of controlling inflation. But while Keynesian economics focus on the stability of currency, Monetarism focuses on price stability, which is achieved through maintaining moneys supply-demand equilibrium.Keynesian economics supports government habit of market conditions by way of monetary policies based on real aggregate demand. When there is economic recession and inflation, it advocates high taxes in order to curb individual spending. But diversion from the monetary angle, it overly employs fiscal strategies, those that relate to government spending, revenues, and debt.Supply-side economics is concerned with policies that produce more incentives for work, rather than stimulate demand. The emphasis on the supply factor is the main difference between the Supply-side and Keynesian theories. Proponents of supply-side economics believe that increasing taxes will only cause revenues to fall, therefore, reducing it will do more good by generating economic activity. However, I believe that this will not increase the supply of labor and services solidly. Lower taxes does not necessarily mean that individuals will choose to be more productive. Moreover, huge tax cuts can cause enormous deficits in the federal budget.5. Given the economic object lesson/theory, you choose to work with, explain your economic strategy for the next cardinal years.In the next four years, I aim to guide the nation towards having a strong and stable financial system. This means that in economic trems, stable prices be maintaned, inflation lessened, and long-term interest order argon moderated. I also aim to keep unemployment to a minimun, or separate yet, lower than the current rate of 5.10%. I propose to achieve these things though policies that follow and Monetarist and Keynesian principles.We can best promote a modern climate by maintaining an environment of low inflation. An important reason for memory inflation low is that businesses will be able to foresee substantial future benefits if they are to be unbidden to bear the long-term risks that are associated with creating new enterprises, and counted low inflation affords them a clearer view of communicate benefits.The Monetarist theory holds that variations in unemployment and inflation rates are caused by changes in the supply of money, and that inflation is a purely monetary phenomenonthis means that if the money supply does not change, the price level remains the same. Therefore, regulating the money supply will ensure a stable economic preformance.The money supply can be balanced through the buying and selling government bonds and securities. By buying securities, the government increases the money supply, thus lowering interest rates. On the same note, when it sells securites, the money supply becomes tighter.Using the Keynesian perspective, rising inflation levels can be curbed by imposing higher taxes to lessen demand and stabilize economic performance. T his can also degrade the money supply so that interest rates will go up, making it harder for firms and consumers to obtain money, thereby reducing aggregate demand.Since the current rate of inflation is on the rise, I propose higher interest rates in order to lessen spending. This can also be done by regulating reserve requirements of member banks, affecting interest rates. When banks reserves are lower, there is a limited mensuration of money to go around so interest rates go up. This usually affects the amount of money banks lend to consumers and firms. When interest rates increase, consumers are less willing to borrow money to spend on goods or services.I look for the above measures to decrease inflation and increase employment rates, which means that the chalk up market value of all the goods and services will also increase. This translates to a higher GNP. Higher taxes would also lessen the budget deficit, and since the deficit is financed by borrowing, the countrys debt w ill decrease as well.As for productivity, I also expect it to increase. The link between costs and productivity is usually a official one. Productivity helps offset costs so if inflation is low, it means that productivity is high.If my strategy does not work and my inflation and unemployment goals were not reached, I whitethorn opt for deficit spending in order to stabilize the economy. magic spell deficit spending can catalyze negative effects, under reliable conditions (such as in a recession), it can help the economy cope. Since the money used to finance deficits usually come from foreign governments and institutions, it would be to the economys profit if they can be convinced to support my proposal..Economic indicators, dictate how the policies are implemented. However, globalization can make it harder to determine the extent of economic manipulation that is needed to promote economic growth. A global market changes the kinetics of traditional economic systems, making econ omic outcomes more difficult to predict. Prices of products and services are now increasingly determined by market factors aside from those within the country. Thus, intervening with the money suppy may not be an unblemished response to certain economic situations. Emerging economic trends and indicators should be interpreted into account regarding government policies and decisions.