2006-11-30 19:22:32 · 3 answers · asked by Anonymous in Education & Reference ➔ Homework Help
China - government control over prices of both goods/services and the means of production.
USA - control on interest rates and government spending. When inflation is high, government increases interest rates and decreases spending - thus reduces demand and presure on prices decrease. When inflation is low and unemployment high, government decreases interest rates and increases spending - thus stimulating the economy, employment and the economy improves.
2006-11-30 23:23:46 · answer #1 · answered by jemhasb 7 · 1⤊ 0⤋
USA: give false #'s to give the impression inflation is under control while easing credit restrictions and rates to fuel a housing boom as people use their inflated home equity as their own ATM to keep economy afloat (for awhile).
China: govt. dicates the value of their currency rather than letting market forces determine.
2006-12-01 03:44:08 · answer #2 · answered by Sizzle Pizzle 3 · 0⤊ 0⤋
Hmmm, If I were to choose the United States and a neighbor, such as Mexico, it'd be like night and day. What semester are you in? What class is this?
2006-12-01 03:31:05 · answer #3 · answered by You are loved 5 · 0⤊ 0⤋