Question: a. Given the information in the table, calculate the missing values of expected inflation, real policy interest rate and risk premium for Economy A. b.

a. Given the information in the table, calculate the missing values

a. Given the information in the table, calculate the missing values of expected inflation, real policy interest rate and risk premium for Economy A. b. What are the 2 factors that determine risk premium? Explain how these 2 factors changes over the course of the business cycle (i.e., economic booms and recessions). c. Explain why the conventional monetary policy becomes ineffective for Economy A. a. Given the information in the table, calculate the missing values of expected inflation, real policy interest rate and risk premium for Economy A. b. What are the 2 factors that determine risk premium? Explain how these 2 factors changes over the course of the business cycle (i.e., economic booms and recessions). c. Explain why the conventional monetary policy becomes ineffective for Economy A

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