Monetary Policy, Fiscal Policy, and the Government Budget Chapter 5 Monetary Policy, Fiscal Policy, and the Government Budget

Figure 5-1 The Effect of an Increase in the Money Supply with a Normal LM Curve and a Vertical LM Curve Copyright © 2003 by Pearson Education, Inc.

Figure 5-2 Effect of the Same Increase in the Real Money Supply with a Zero Interest Responsiveness of Spending and with a High Interest Responsiveness of the Demand for Money Copyright © 2003 by Pearson Education, Inc.

Figure 5-3 Effect of a Fiscal Stimulus When Money Demand Has an Infinite and a Zero Interest Responsiveness Copyright © 2003 by Pearson Education, Inc.

Figure 5-4 The Effect on Real Income of a Fiscal Stimulus with Three Alternative Monetary Policies Copyright © 2003 by Pearson Education, Inc.

International Perspective Policy Paralysis in Japan Source: IMF and OECD. Copyright © 2003 by Pearson Education, Inc.

International Perspective Policy Paralysis in Japan Source: Bank of Japan and Federal Reserve Board Copyright © 2003 by Pearson Education, Inc.

Figure 5-5 The Federal Funds Rate, 1980–2002 Copyright © 2003 by Pearson Education, Inc.

Figure 5-6 The Federal Government Budget, 1980–2005 Copyright © 2003 by Pearson Education, Inc. Source: Congressional Budget Office, January 2002.

Figure 5-7 Real Government Expenditures, Real Government Revenues, and the Real Government Budget Deficit, 1900–2001 Copyright © 2003 by Pearson Education, Inc.

Figure 5-8 The Relation Between the Government Budget Surplus or Deficit and Real Income Copyright © 2003 by Pearson Education, Inc.

Figure 5-9 Effect on the Budget Line of an Increase in Government Expenditures Copyright © 2003 by Pearson Education, Inc.

Figure 5-10 A Comparison of the Actual Budget and the Natural Employment Budget, 1955–2002 Copyright © 2003 by Pearson Education, Inc.

Figure 5-11 Components of Net Saving and Investment, 1960–2001 Copyright © 2003 by Pearson Education, Inc.