Saturday, March 21, 2015
Nominal Interest Rates, Price Level changes, and the Real Interest Rate
Nominal Interest Rates, Price Level changes, and the Real Interest Rate
Monetary Policy (money market, loanable funds, investment, AD/AS) & real interest rates
Monetary Policy (money market, loanable funds, investment, AD/AS) & real interest rates
So lately I've been trying to increase my understanding of how fiscal and monetary policies work in tandem. I've been a bit dismayed as many students can't understand the Real interest Rate questions on the AP exam and I haven't found any resources that string it all together.
So I've spent a few days working through the past FRQ's and Multiple choice sections of exams in hopes of clarifying exactly what the college board is testing.
1st Monetary Policy
On the left is an explanation of the causal chain of events. On the right is a graphical illustration of the left side. Sometimes seeing what happens in graphs makes the left side a bit more clear. Hope this helps,,, any mistakes, corrections, comments,, wcwaugh@aol.com
So lately I've been trying to increase my understanding of how fiscal and monetary policies work in tandem. I've been a bit dismayed as many students can't understand the Real interest Rate questions on the AP exam and I haven't found any resources that string it all together.
So I've spent a few days working through the past FRQ's and Multiple choice sections of exams in hopes of clarifying exactly what the college board is testing.
1st Monetary Policy
On the left is an explanation of the causal chain of events. On the right is a graphical illustration of the left side. Sometimes seeing what happens in graphs makes the left side a bit more clear. Hope this helps,,, any mistakes, corrections, comments,, wcwaugh@aol.com