## Introduction to Dynamic Macroeconomic Theory: An Overlapping Generations ApproachEconomies are constantly in flux, and economists have long sought reliable means of analysing their dynamic properties. This book aims to provide a succinct and accessible exposition of modern dynamic (or intertemporal) macroeconomics. |

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Results 1-3 of 17

Page 293

We wish, first, to find out what determines the

neither legal restrictions nor other governmental controls are determining the

price of one currency against another. We can then add some government

controls ...

We wish, first, to find out what determines the

**exchange rate**in a system in whichneither legal restrictions nor other governmental controls are determining the

price of one currency against another. We can then add some government

controls ...

Page 296

for i equals A and B. The rate of return (the rate of change of prices) of the two

moneys must be the same if both the monies are to have value. Let E(t) be the

for i equals A and B. The rate of return (the rate of change of prices) of the two

moneys must be the same if both the monies are to have value. Let E(t) be the

**exchange rate**at time t. We define this**exchange rate**as the number of units of ...Page 297

Let £(1) be the

country B at time period 1 . The arbitrage condition (Equation 11.1) says, when

considering period 1, that _ />A(2) _ />B(2) Rearranging the two right-hand parts

...

Let £(1) be the

**exchange rate**between the money of country A and the money ofcountry B at time period 1 . The arbitrage condition (Equation 11.1) says, when

considering period 1, that _ />A(2) _ />B(2) Rearranging the two right-hand parts

...

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### Contents

Describing the Environment | 5 |

Competitive Equilibrium | 32 |

Introducing a Government | 55 |

Copyright | |

10 other sections not shown

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### Common terms and phrases

45-degree line A-period bonds aggregate savings function amount arbitrage assets autarky Bailey curve bequests bliss point borrowing and lending budget line capital stock Chapter chooses competitive equilibrium Consider an economy consumption allocation consumption point consumption when old consumption when young credit controls crop endowment point equal Equation equilib equilibrium condition equilibrium price example economy exchange rate EXERCISE expected price fiat money Figure given gives government bonds government revenues gross interest rate growth rate hold indifference curve individual h inflation labor lifetime budget constraint market clearing maximize member h money creation money supply output Pareto optimal Pareto superior perfect foresight period person h pm(t present value price of land price path price sequence private borrowing Proposition purchase quantity rate of growth rate of return reserve requirement restrictions result Ricardian equivalence seignorage solve stationary equilibrium stationary monetary equilibrium storage sumption tax-transfer scheme taxes and transfers temporary equilibrium tion utility function