8. Прикро, що збільшення грошової маси є поштовхом для інфляції. 9. Існує прямий зв'язок між наявною в обігу кількістю грошей та рівнем виробництва.
Exercise 4. Answer the following sentences:
1. What strategies does government rely on promote maximum employment, production and purchasing?
2. What is fiscal policy?
3. How is fiscal policy applied?
4. In what ways could the recession be reserved?
5. What will happen when business and consumer spending begins to increase?
6. Can fiscal tools be used to slow the economy?
7. What serious drawbacks have fiscal policy solutions?
8. What is monetary policy?
Exercise 5. Read and translate the following dialog:
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A.: |
Can you tell me what times we are living through? As I know when people speak of prosperity and depression, they think of things like business cycles. |
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B.: |
Yes! The business cycle is the pattern of periodic ups and down of business activity. |
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A.: |
And how does the government try to stabilize the ups and down of the economy? |
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B.: |
In its efforts to stabilize the economy and achieve its goals the government relies on the fiscal and monetary policy. |
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A.: |
Do you know anything about fiscal policies? |
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B.: |
Certainly, I do. Fiscal policies seek to adjust total demand through the appropriate use of the government’s powers to tax and to spend. Fiscal policy is in the hands of the President and Congress. |
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A.: |
Then monetary policies must be quite different. |
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B.: |
Not exactly. Monetary policies seek to achieve similar goals by regulation the money supply. Monetary policies are determined by the Board of Governors of the Federal Reserve System. |
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A.: |
And how do fiscal policies influence the events in times of recession? |
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B.: |
In times of recession fiscal policies would call some combination of tax reductions and increases in government spending. |
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A.: |
And what about monetary policies? |
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B.: |
Monetary policies in those times would seek to increase the money supply through strategies such as the increased purchasing of government securities by the Open Market Committee, a lowering of discount rate, and a reduction in the reserve ratio |
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A.: |
And what happen in its times of inflation? |
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B.: |
In times of inflation both fiscal and monetary policies would follow an opposite course. |