Economic History

Running Head : ECONOMIC HISTORYEconomic History : Answers to Questions[Author][Affiliation][Date]Economic History : Answers to QuestionsA ) fend for what Keynes thought were the pros and cons of the active use of financial indemnity and of pecuniary indemnity to stabilize an prudence (3 pointsAccording to Keynes , recessions and financial crises can be avoided if central banks maintain general equilibrium in the bills markets (via financial policy . It can reduce money offer by selling bonds . It can subjoin money total by buying bonds . This step-up- shine in money supply is a general tool utilized by central banks to estimate the robustness of the financial market . In short , the trend of the policy is to make the prices of financial assets stable (prevents panic .

Keynes unless , argued that monetary policy does not raise the national income pecuniary policy only creates an illusion of economic prosperityKeynes favored the use of pecuniary policy in increasing the level of national income because of both major(ip) reasons . First , fiscal policies be easier to implement than monetary policies . A presidential term can increase or accrue its expenditure level depending on the status of the delivery If an economy is in recession , then the government can increase its level of expenditure . If actual gross domestic crossway exceeds potential GDP , then a slight falling off in government spending is necessary . Not e that the mechanism by which fiscal policie! s are implemented are a lot less civilize than that of implementing monetary policies . Second , the effects of fiscal policy are more pronounced than that of...If you want to get a full essay, consecrate it on our website: OrderCustomPaper.com

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