Assuming that Thailand is a small open economy

QUESTION

** Read articles and answer the questions with graphs and explanation with citing articles provided. Length is better SHORT with quality answers**http://www.wsj.com/articles/how-thailand-plans-to-jump-start-its-economy-1443759023WSJ – THAILAND JUMP-STARTS ECONOMY1. Assuming that Thailand is a small open economy, use the IS-LM model to explain how interest free loans may impact the Thai economy. How would your answer change if Thailand had fixed exchange rates?2. Assuming that Thailand is a small open economy, use the IS-LM model to explain how increased FDI flows into Thailand would impact the Thai economy.3. Assuming that Thailand is a small open economy, use the IS-LM model to explain how the government’s rice buying program impacted the Thai economy.http://www.wsj.com/articles/abenomics-is-doing-better-than-you-think-1444232698WSJ – ABENOMICS DOING BETTER THAN YOU THINK5. Assuming Japan is a large open economy, use the wallet model to explain the impact of monetary stimulus on the Japanese economy. Be sure to denote the LR equilibrium.6. Assuming Japan is a large open economy, use the wallet model to explain the impact of the consumption tax increase on the Japanese economy. Be sure to denote the LR equilibrium. How would monetary stimulus coordinate with an increase in the consumption tax?7. Traditionally, Japanese firms are hesitant to fire workers. Explain how this cultural factor impacts Japanese hiring and kapital investment practices. Use the model to illustrate how a more Western model of labor practices would impact the Japanese economy.http://www.wsj.com/articles/indias-economic-growth-slows-1441025725WSJ – INDIA’S ECONOMY OUTSHINES NEIGHBORS8. Assuming India is a large open economy, use the wallet model to explain the impact of increased household spending on the Indian economy. Be sure to denote the LR equilibrium. How could this lead to a “flattening out” of growth?9. Indian and Chinese firms tend to compete in the export of low-value added goods. Show the impact of China devaluing it’s currency on the Indian economy using the wallet model. Be sure to denote the LR equilibrium.10. Why would enticing greater FDI flows to India be so important for the Indian economy? Use the wallet model to support your answer. Be sure to denote the LR equilibrium.

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