Sample Essay on:
Monetary Policies And Airlines

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Essay / Research Paper Abstract

A 3 page paper that begins by explaining what monetary policy is, what it does and who administers the policies. The writer discusses airlines and comments on hiring at and growth of airlines when the monetary policies to spur growth are in place. Bibliography lists 5 sources.

Page Count:

3 pages (~225 words per page)

File: MM12_PGmntarl.rtf

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Unformatted sample text from the term paper:

the availability of money within the country (Financial Pipeline, 2002). It is important for any national government to take the steps necessary to influence economic activity so that it is commensurate with the political objectives of that government (Financial Pipeline, 2002). The goal of the monetary policy is typically to achieve what is called macroeconomic stability, which is translated into low inflation, economic growth, low unemployment, and a balance of the nations external payments (Financial Pipeline, 2002). The monetary policy is most often administered by a central bank that is appointed by the nations government (Financial Pipeline, 2002). In America, the central bank is the Federal Reserve Bank of the United States (Financial Pipeline, 2002). In turn, the goals and objectives the Federal Reserve Bank are "to achieve sustainable growth, to assure price stability and to maintain the integrity of the nations financial system" (Smith, 2001, p. ITEM01276019). The Bank uses a number of different tools to achieve its goals. An excellent example of how the Federal Reserve Bank influences monetary policy and private as well as public businesses is illustrated in its actions immediately following 9/11. Discount rates offered by the Bank system drive interest rates available to businesses (Smith, 2001). Numerous industries, including the airline industry benefited from these actions. When the economy slows down, the monetary policy is to reduce interest rates to make more funds available to everyone, businesses and consumers. When airlines have the money to expand, they hire new employees. They can also upgrade and update their equipment and grow. Brueckner (2002) reports that when the economy is strong, both business and leisure travel increases. However, it does not grow at the same rate as other sectors in the service industry (Brueckner, 2002). This investigator reports that a 10 percent increase in the ...

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