For This Question,assume That Equilibrium Output Is Determined in the ZZ-Y

question 33

Essay

For this question,assume that equilibrium output is determined in the ZZ-Y diagram.Further assume that policy makers' goals are (1)to achieve balanced trade (i.e.,NX = 0); and (2)to achieve a target level of output,say Yᵀ.Now,suppose that the initial level of equilibrium output is equal to Yᵀ (i.e.,Y = Yᵀ)and that a trade deficit exists at this initial level of output.Which of the following policy actions would most likely enable the policy makers to achieve their two goals simultaneously?
A)a reduction in government spending
B)convince the country's trading partners to pursue policies that will cause an increase in foreign income (Y*)
C)a reduction in the real exchange rate
D)a reduction in taxes
E) a simultaneous increase in government spending and reduction in the real exchange rate
F) none of the above

• A)a reduction in government spending
• B)convince the country's trading partners to pursue policies that will cause an increase in foreign income (Y*)
• C)a reduction in the real exchange rate
• D)a reduction in taxes
• E) a simultaneous increase in government spending and reduction in the real exchange rate
• F) none of the above

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Definitions:

Douglas Conant's Leadership

is characterized by his transformational approach, emphasizing employee engagement, respect, and a high level of communication during his tenure as CEO of Campbell Soup Company.

Referent Power

A form of influence based on the leader's appeal or charisma, leading others to identify with them.

Expert Power

A form of influence derived from possessing specialized knowledge or skills in a particular area.

Coercive Power

Refers to the ability of a person to influence others' actions through threats or punishment.