For Each of the Following Situations,state for Each What Aggregate

question 5

Essay

For each of the following situations,state for each what aggregate demand policy the country was most likely following:
(a)The economy has been growing and experiencing inflation.At the same time interest rates have been declining while the trade deficit has worsened.
(b)The economy has been growing and experiencing inflation.At the same time interest rates have been rising while the trade deficit has worsened.In this case,rising interest rates failed to attract significant capital inflow.
(c)Inflation has subsided while the exchange rate has risen.
(d)The economy's competitiveness has eroded due to a rising exchange rate and domestic inflation and interest rates have risen.Still,the economy has been enjoying healthy growth.In this case,exchange rates have risen because rising interest rates attracted significant capital inflow.

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Definitions:

Deposits

Funds placed into a bank account or with some other entity for safekeeping, which can include money put in savings or checking accounts.

Electronic Funds Transfers

The electronic transfer of money between accounts by consumer electronic systems rather than the exchange of cash, checks, or other paper documents.

Internal Control Of Cash

Procedures and measures implemented by a business to monitor, manage, and protect its cash transactions and holdings.

Voucher System

A control mechanism in accounting to approve and document all disbursements of cash for business transactions.