Why the Relative Fiscal Effectiveness of an Open Economy

It depends on the transmission mechanism of the monetary policy.

The monetary policy transmission mechanism refers to the process in which the bank uses monetary policy tools to transmit it to enterprises and residents through the business activities of financial institutions and the financial market according to the monetary policy objectives, and has an impact on their production, investment and consumption behaviors. Under normal circumstances, the transmission of monetary policy is carried out through credit, interest rates, exchange rates, assets** and other channels.

From the perspective of China's practice, the formulation of monetary policy by the bank is the starting point for the formation of the monetary policy transmission mechanism, and its policy adjustment is mainly focused on the guidance of base money, interest rate and credit policy.

In the face of the policy adjustment of the first bank, the commercial bank has adjusted the total amount of loans to enterprises and residents, the direction of investment and the floating range of interest rates in accordance with the operating principles of "four self" (independent decision-making, independent operation, self-responsibility for profits and losses, and self-risk) and "three natures" (profitability, safety, and liquidity), with a view to influencing the production, investment and consumption behavior of enterprises and residents, and ultimately having an impact on the macroeconomy.

Due to the initial establishment of China's socialist market economic system, the transmission process of monetary policy will be affected by the operating system of commercial banks and the operating mechanism of enterprises, which will weaken the transmission effect of monetary policy to some extent, and even hinder it.

Answer]: A contractionary fiscal policy refers to a policy behavior that reduces and suppresses aggregate social demand mainly by increasing taxes and reducing expenditures, thereby reducing deficits or increasing surpluses. Under the effect of multipliers, a reduction in aggregate demand can lead to a multiple-fold reduction in national income, thus achieving the policy objectives of curbing excessively rapid economic growth and controlling inflation.

Falling inflation will lead to an increase in domestic unemployment. The loose monetary policy has shifted the line to the right, causing interest rates to fall and capital outflows to increase.

(1) State finance is the material guarantee for promoting social equity and improving people's lives. Spending on education increased by 23 7 year-on-year; Expenditure on social security and employment increased by 46.5 year-on-year, of which the expenditure on living allowance for natural disasters increased by 9.9 times year-on-year; Health expenditure increased by 34 7 year-on-year; Spending on science and technology increased by 43 8 year-on-year; Expenditure on environmental protection increased by 92 percent year-on-year, and the government has allocated 36.31 billion yuan in subsidies for urban and rural subsistence allowances to ensure the basic livelihood of groups in need. (2) State finance plays a role in promoting the rational allocation of resources.

Expenditure on agriculture, forestry and water affairs increased by 37 8 year-on-year; 36,538 billion yuan of oil price subsidies were allocated to support the development of agriculture, forestry and fishery, public transportation and other industries that were greatly affected by the adjustment of refined oil products. (3) The state finance has the role of promoting the smooth operation of the national economy. According to the price situation, improve and implement various financial subsidy policies in a timely manner.

When a country's international receipts are greater than its expenditures, it is a balance of payments surplus.

At the time, it can be said that the foreign exchange is greater than the demand, so the national currency appreciates, and the foreign currency of Lashouling depreciates. Conversely, when a country's international income is less than its expenditure, it is in deficit.

It can be said that the foreign exchange is less than the demand, so the domestic currency depreciates and the foreign currency appreciates. The balance of payments refers to a country's foreign economic activities.

The balance of payments needs to be settled by the foreign exchange generally accepted by each country.

Extended Materials. 1. Open macroeconomics of economic wheels.

The study is conducted on economies under the conditions of ** and financial linkages between countries.

The logic of behavior.

2. Foreign** includes import and export. While the U.S. can manufacture most of the goods it needs, imports are still enormous. Imports are those goods and services that are supplied abroad and consumed in the United States.

Export refers to goods and services that are produced domestically and purchased by other countries.

3. Net exports are defined as the net value of goods and services exported minus imported goods and services. Net exports of the United States in 2007 were negative $708 billion, or $1,662 billion in exports minus $2,370 billion in imports. When a country's net exports are positive, it is accumulating its own assets abroad.

One concept that corresponds to net exports is net foreign investment, which represents a country's net savings abroad and is roughly equal to the value of net exports. Since the United States has negative net exports, net foreign investment is also negative, which means that the United States' foreign debt is increasing.

4. In an open economy, a country's spending may differ from its output. Domestic spending (sometimes referred to as domestic demand) is equal to consumption plus domestic investment plus procurement. It is related to gross domestic output (or gross domestic product.

GDP) is different in two ways. First, a portion of domestic spending is spent on the purchase of foreign-produced products, which are called imports (denoted by IM), such as the purchase of Mexican oil and Japanese automobiles. Second, a portion of U.S. domestic output will be exported (expressed in ex) to foreign countries, such as abroad** wheat and Boeing aircraft.

The difference between domestic output and domestic expenditure is equal to exports minus imports, i.e., net exports, ex-im = x.

**There are three differences in the impact of expansionary fiscal and monetary policies on interest rates: 62616964757a686964616fe4b893e5b19e31333431346462

1. The meaning is different.

Fiscal policy is to affect aggregate demand through the adjustment of total fiscal revenues and expenditures; Monetary policy is the adjustment of the amount of money and credit by the bank, which in turn affects the economy.

2. The content is different.

The content of fiscal policy and fiscal revenue are related to expenditure; The content of monetary policy is related to interest rates, credit policies, etc.

3. The policymakers are different.

Fiscal policy is usually set by the state; Monetary policy is set directly by the central bank.

Fiscal policy: Fiscal policy refers to the guiding principle of fiscal work stipulated by the state in accordance with the tasks of political, economic and social development in a certain period, and adjusts aggregate demand through fiscal expenditure and tax policy.

Monetary policy: The sum of the policies and measures that the bank uses various tools to regulate the amount of money and interest rates in order to achieve the established economic objectives (stabilizing prices, promoting economic growth, achieving full employment and balancing the balance of payments), thereby influencing the macroeconomy.

Expansionary monetary policy can directly increase the money supply, thereby regulating interest rates through direct connection between money supply and demand.

Expansionary fiscal policy will increase purchases, transfer payments, etc., but does not change the total supply of money, and has no direct impact on interest rates, but if expansionary fiscal policy brings a large fiscal deficit, it may issue treasury bonds to finance, then it will increase the demand for money and indirectly push up market interest rates.

If an expansionary fiscal policy is adopted, then the interest rate on the currency will fall.

Under an open economy, the following are not the ultimate goal of macroeconomic policy: [ ] A balance of payments b There is no **deficit.

or surplus C meridian.

zhaoxingcang |2012-11-28Under the open economy, the following is not the ultimate goal of macroeconomic policy.

b There is no **deficit or surplus.

c Balanced economic growth.

d Elimination of inflation.

I got it.. Correct answer: B

Analysis] according to Western economics.

Macroeconomic policy.

The goals are full employment, stability, economic growth and balance of payments. Macroeconomic policies are the means and measures designed to achieve these goals.

Macroeconomic policy (the main means of regulating the market) refers to the economic measures to maintain the basic balance of the total economic aggregate, promote the optimization of the economic structure, guide the sustained, rapid and healthy development of the national economy, and promote the all-round progress of society. The so-called macroeconomic regulation and control is corresponding to the market economy and is the main means of regulating the market.