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QUESTION 20 One way to reduce the recessionary gap through fiscal policy is to increase government...
The economy is in a recession and the recessionary gap is large. A discretionary fiscal stimulation...
The economy is in a recession and the recessionary gap is large. A discretionary fiscal stimulation package that would avoid a budget deficit is a simultaneous and equal increase in government expenditure and an increase in taxes. decrease in government expenditure and taxes. increase in transfer payments and a decrease in taxes, decrease in transfer payments and increase in the quantity of money increase in transfer payments and decrease in the quantity of money
What fiscal policy would you recommend to eliminate the inflationary or recessionary gap in the following...
What fiscal policy would you recommend to eliminate the inflationary or recessionary gap in the following scenarios: Real GDP $44,500; potential GDP $46,200; mpe 0.2. O A. If the mpe is 0.2, the multiplier is 1.25. Because there is a recessionary gap of $1,700, the government should increase expenditures by $1,360 or decrease taxes by $6,800. O B. If the mpe is 0.2, the multiplier is 1.25. Because there is an inflatonary gap of $1,700, the government should decrease expenditures...
The economy is in a recession and the recessionary gap is large. Describe a discretionary fiscal...
The economy is in a recession and the recessionary gap is large. Describe a discretionary fiscal stimulus package that could be used that would not bring an increase in the budget deficit. A discretionary fiscal stimulation package that would avoid a budget deficit is a simultaneous and equal ______. A. increase in government expenditure and an increase in taxes B. decrease in government expenditure and taxes C. decrease in transfer payments and increase in the quantity of money D. increase...
THERE ARE 20 total QUESTIONS PLEASE ANSWER ALL OF THEM QUESTION 1 One way to reduce the recessio...
THERE ARE 20 total QUESTIONS PLEASE ANSWER ALL OF THEM
QUESTION 1 One way to reduce the recessionary gap through fiscal policy is to O increase government purchases. increase taxes. O decrease transfer payments. decrease the MPC QUESTION 2 Which of the following is true of open-market operations? It involves the purchase and sale of government securities by the central bank. O it involves the purchase and sale of stocks and bonds by private banks. It involves measures taken by...
Fiscal Policy Assume the economy is in a recession. The recessionary output gap has been identified...
Fiscal Policy Assume the economy is in a recession. The recessionary output gap has been identified as $500 billion dollars. The Federal Government wants to act to combat the recession. 1. (4 points) Past data suggests that a $10 million change in spending caused a $200 million change in total output. Use this information to calculate the Government Spending Multiplier. In one sentence, give a definition of the multiplier. 2. (6 points) Using your answer in part (1) calculate the...
Suppse the government wants to use fiscal policy to return the economy from a recessionary gap...
Suppse the government wants to use fiscal policy to return the economy from a recessionary gap to a full-employment equilibrium.What policies mught they consider? with the as-ad graph, discuss the adjustment process in the private sector by the fiscal stimulus
The government can reduce inflation with the help of both fiscal and monetary policy.
The government can reduce inflation with the help of both fiscal and monetary policy. An effective combination of these policies to reduce inflation would be to _______ and _______ Increase taxes; lower the reserve requirement ratio Increase taxes; sell government bonds Decrease taxes; buy government bonds Decrease government spending; lower discount rate
1) Suppose that the national economy is experiencing a recession with an estimated recessionary gap of...
1) Suppose that the national economy is experiencing a recession with an estimated recessionary gap of $10 billion. Congress is considering the use of fiscal policy to ease the recession, and due to current political sentiments, it has determined that the maximum spending increase the government is willing to support is $3 billion. The government wants to make up the remainder of the recessionary gap using tax cuts. If a spending increase of $3 billion is approved and the MPC...
Classify each statement as an example of expansionary fiscal policy, contractionary fiscal policy, or not an...
Classify each statement as an example of expansionary fiscal policy, contractionary fiscal policy, or not an example of fiscal policy. Expansionary fiscal policy Contractionary fiscal policy Not an example of fiscal policy Answer Bank a decrease in government spending an increase in corporate bonds purchased a decrease in transfer payments a decrease in the money supply a decrease in taxes an increase in the money supply a decrease in the unemployment rate an increase in tax rates an increase in...
1) Suppose economists observe that a $10B increase in government spending raises aggregate demand in the...
1) Suppose economists observe that a $10B increase in government spending raises aggregate demand in the economy by $30B. If this country does not trade and there is no crowding out of private sector spending, what would MPC be equal to? 2) Do you agree or disagree with the following statement? Explain your answer “An increase in government purchases (G) is usually a more effective policy than an increase in transfer payments when the goal is to eliminate a recessionary...
The economy is in a recession and the recessionary gap is large. A discretionary fiscal stimulation package that would avoid a budget deficit is a simultaneous and equal increase in government expenditure and an increase in taxes. decrease in government expenditure and taxes. increase in transfer payments and a decrease in taxes, decrease in transfer payments and increase in the quantity of money increase in transfer payments and decrease in the quantity of money
What fiscal policy would you recommend to eliminate the inflationary or recessionary gap in the following scenarios: Real GDP $44,500; potential GDP $46,200; mpe 0.2. O A. If the mpe is 0.2, the multiplier is 1.25. Because there is a recessionary gap of $1,700, the government should increase expenditures by $1,360 or decrease taxes by $6,800. O B. If the mpe is 0.2, the multiplier is 1.25. Because there is an inflatonary gap of $1,700, the government should decrease expenditures...
THERE ARE 20 total QUESTIONS PLEASE ANSWER ALL OF THEM
QUESTION 1 One way to reduce the recessionary gap through fiscal policy is to O increase government purchases. increase taxes. O decrease transfer payments. decrease the MPC QUESTION 2 Which of the following is true of open-market operations? It involves the purchase and sale of government securities by the central bank. O it involves the purchase and sale of stocks and bonds by private banks. It involves measures taken by...
Fiscal Policy Assume the economy is in a recession. The recessionary output gap has been identified as $500 billion dollars. The Federal Government wants to act to combat the recession. 1. (4 points) Past data suggests that a $10 million change in spending caused a $200 million change in total output. Use this information to calculate the Government Spending Multiplier. In one sentence, give a definition of the multiplier. 2. (6 points) Using your answer in part (1) calculate the...
Classify each statement as an example of expansionary fiscal policy, contractionary fiscal policy, or not an example of fiscal policy. Expansionary fiscal policy Contractionary fiscal policy Not an example of fiscal policy Answer Bank a decrease in government spending an increase in corporate bonds purchased a decrease in transfer payments a decrease in the money supply a decrease in taxes an increase in the money supply a decrease in the unemployment rate an increase in tax rates an increase in...
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