Earlier today, you saw that the federal funds rate in the United States is currently 4.5 percent (i.e., at the upper bound of the 4.25-4.5 percent target range). The bank rate in the United Kingdom is also 4.5 percent. The FOMC is meeting on Tuesday and Wednesday of the coming week and you expect the committee to drop the interest rate target by 0.5 percentage points. Based on this information you expect that ______ Select all that apply.

You have the following data for GDP per capita in 1990 and in 2023: Japan Australia Italy World 1990 $25,265 $18,249 $23,297 $6,803 2023 $33,766 $64,820 $39,003 $11,578 Based on this information, you expect Japan’s trade balance to be ______ in 1990. Hint: Compute the average annual growth rate of GDP per capita between 1990 and 2023 for each country and the world economy to answer this question. Round the growth rates to the nearest tenth of a percent.

In response to a negative one-time oil price shock, the U.S. economy would initially experience a ______. Next, as soon as the oil price shock ends, it would ______ by way of ______.

In November 2020, the price level in the U.S. was . At the same date, the price level in the Eurozone was . One year later, the price levels were  and . During this 12-month period, the real exchange rate was constant. The nominal exchange rate (E) is reported in euros per dollar (i.e. how many euros do we need to purchase one dollar). Using the information above, calculate the rate of change of E during this time (in percent). Round your answer to the nearest tenth of a percent.

In the standard AS-AD framework, after a negative permanent demand shock at time , the economy approaches an equilibrium with

Suppose the Federal Reserve decreases interest rates from 4% to 3%, which shifts aggregate demand and increases short-run output to 1.0%. If there are no other shocks to the economy, and the resulting change in inflation is 6.0 percentage points, what is the value of the parameter

In the long run, the economy with a labor force growth rate of 2 percent will have an unemployment rate of ______ percent. Round your answer to the nearest tenth of a percent.

A central bank with a credible commitment to keeping inflation near its target rate

Consider the IS curve

You are a staff economist with the Federal Reserve. The chairman says to you, “We are seeing signs of inflation above our target rate, and I don’t think the Phillips curve is very steep. What should we do to bring the rate back to our target rate?” How do you respond? Answer:  “Because the Phillips curve is relatively flat, we need to interest rates in order to the investment-to-potential output ratio and hence short-run output. A flat Phillips curve requires a in short-run output in order to lower the inflation rate.”