What is fiscal policy all about? Explain the notion of budget (revenues and expenditures), and budget deficit.
Measuring the fiscal imbalance.
Public debt and debt accumulation
Demand-side effects: the Keynesian analysis
Effect of a Keynesian expansionary fiscal policy. Explain by using graph.
Mövzu 6 Fiscal policy: issues and theories
Why “the room for maneuver for fiscal policymakers” is generally limited in the short run? Justify your answer.
Explain the sources of deficit financing: what is the impact over inflation?
Financial balance vs primary balance: explain the difference
Explain the solvency of the public sector: what happens if solvency decreases?
Why governments cannot fully provide financial reporting as private sector does? Explain each of the reasons briefly.
What happens when aggregate demand is insufficient? Explain the role of fiscal policy in such situation. Show on an example.
Explain the notions of expansionary fiscal policy and contractionary fiscal policy and their impact over total output.
Explain the notions of expenditure multiplier and tax multiplier. Use an example calculation to justify your explanation.
Assume that in Azerbaijan economy, Marginal Propensity to Consume is … (or …%). How much change in national income will be if government expenditure increases … AZN? Explain your result from economic point of view.
Assume that in the economy of Georgia, Marginal Propensity to Consume is … (or …%). How much change in national income will be if government expenditure increases … USD? Explain your result from economic point of view.
Assume that in the economy of Turkey, Marginal Propensity to Consume is … (or …%). How much change in national income will be if tax revenues increases … USD? Explain your result from economic point of view.
Assume that in the economy of Russian Federation, Marginal Propensity to Consume is … (or …%). How much change in national income will be if tax revenues increases … USD? Explain your result from economic point of view.
What is Crowding Out effect? Explain on an example.
Why it is argued that “tax cuts have no effect on spendingand national savings”?
Implications of Ricardian Equivalence: explain briefly
What is monetary policy? Explain money and monetary aggregates.
Expansionary monetary policy vs contractionary monetary policy
What do central banks do?
Explain the price of liquidity. the rate applied to a repurchase agreement is 5%, a bank seeking liquidity from the central bank for 14 working days for an amount of 200 million euros, how much will have to pay the bank for this liquidity service?
Explain money creation process by the central bank and commercial banks. Use an example to support your answer.
The objectives of monetary policy. Explain all objectives briefly
Explain the long-run neutrality of money and short-run nominal rigidities.
Comment on Central Bank credibility and inflation targetting.
Transmission channels of monetary policy: briefly explain three main transmission channels.
Central Bank’s independence vs seigniorage revenues of the government. Why it is better to have technocratic governance for Central Banks?
Mövzu 9-10: International Financial Integration and Foreign-Exchange Policy
Convergence and inequality: comment on the relationship between economic growth and inequality
It is stated that “poor people are poor because they are poor”. In country level (i.e., poor country and rich country), explain this argument and justify your answer.
Public policy roadmap in the short-run and long-run.
Stimulating economic growth: the role of stabilization and allocation policies.
Explain the interrelation between long-term trends and short-term fluctuations in an economy (from economic growth context).
Do improving institutions matter for better economic growth? Justify your answer.
Mövzu 13-14: Tax policies
What is taxation about? Explain benefits of taxation.
One benefit of taxation is that “taxation can play a “paternalistic” role by protecting private agents from their own errors”. Discuss and comment on this argument. Support your answer by using examples.
Explain the argument - “too much taxes kill taxes”: The Laffer curve
How are taxes collected? Direct taxes and indirect taxes.
Mövzu 15: Overall evaluation of Azerbaijan’s economic policy
Discuss fiscal policy implementation in Azerbaijan after 2000.
Discuss Azerbaijan’s monetary and exchange rate policies after 2000.
Discuss Azerbaijan’s tax policy and taxation system. Especially comment on the changes after 2014.