Explain how an equal or balanced change in government spending and tax revenues may cause income...
Explain how an equal or balanced change in government spending and tax revenues may cause income to rise
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Explain how an equal or balanced change in government spending
and tax revenues may cause income...
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to...
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to the right. tne long-run aggregate supply curve shifts to the left. C) the 20) When aggregate demand curve shifts to the left. the short-run aggregate supply curve shifts to the left. t spending without an accompanying increase 21) An increase in govenment spending n taxes demand A) does not increase aggregate B) would effectively eliminate an inflationary gap. Q mquires additional govemment borrowing spending...
Government spending in Robok is $150 billion, and its only tax is an income tax with...
Government spending in Robok is $150 billion, and its only tax is an income tax with a marginal tax rate of 0.3. a. The balance on the government’s budget at a GDP level of $440 billion is a (Click to select) deficit surplus of $ billion. b. The balance on the government’s budget at a GDP level of $550 billion is a (Click to select) deficit surplus of $ billion. c. At what level of GDP will the economy of Robok have a balanced budget? Robok will have a balanced...
The introduction of a tax by the government will: a. affect government spending since the...
The introduction of a tax by the government will: a. affect government spending since the government levies the tax. b. affect consumption through its effect on investment. c. have no effect on real GDP since real GDP comprises consumption expenditure, investment expenditure, and government expenditure. d. increase real GDP since it enables the government to increase spending. e. affect consumption through a change in disposable income.
(1) Calculate the government spending multiplier if, an increase in government spending by $5 million increases...
(1) Calculate the government spending multiplier if, an increase in government spending by $5 million increases real GDP by $20 million. Group of answer choices 0.20 0.25 2 5 4 (2) A major benefit of automatic stabilizers is that they: Group of answer choices guarantee a balanced budget over the course of the business cycle. have a tendency to reduce the national debt. moderate the effect of fluctuations in the business cycle. require legislative review by Congress before they can...
1. GDP - annual debt 2. government spending - tax revenue >0 3.government spending - tax...
1. GDP - annual debt
2. government spending - tax revenue >0
3.government spending - tax revenue <0
4. annual debt/GDP
5 annual deficit/GDP
6. total debt - debt held by us households and institutions
==================================================
A budget deficit is government spending in excess of what?
A.. tax revenues
B. real GDP
C. household spending
D. consumption
================================================
What would happen to the cyclical deficit if the GDP growth rate
jumped from 2 percent to 4 percent?
A.decrease in deficit...
MPC Spending Multiplier Change in income 100 20 0.99 0.95 0.6 0.5 Change in government spending...
MPC Spending Multiplier Change in income 100 20 0.99 0.95 0.6 0.5 Change in government spending $15 $100 -$400 $450 $1,500 $2,000 -$1,000 $900 2.5 2.0 4. Assume that the equilibrium in the loanable funds market is at interest rate of 1.25% and quantity of funds at $20 billion. Suppose the current government deficit is zero so government is not borrowing any money. a) Suppose now government increases spending by $2 billion and finances it entirely by borrowing. This deficit...
a) Suppose that a provincial government collects income tax revenues using a linear income tax schedule....
a) Suppose that a provincial government collects income tax revenues using a linear income tax schedule. A taxpayer who has a zero income in a given year receives a $500 as a living allowance from the government. If a taxpayer who has an annual income of $30,000 pays $4000 in taxes, what is the marginal tax rate? Draw the linear income tax schedule on a diagram. Is the tax schedule regressive? b) Using a simple economic model, explain the factors...
If the economy is close to full employment, an increase in government spending may increase GDP...
If the economy is close to full employment, an increase in government spending may increase GDP in the short run, but in the long run, this policy may: reduce investment in new capital. make domestic businesses less competitive in international markets if the dollar appreciates in value raise interest rates and reduce consumer expenditures on cars and new houses All of these options are correct Which of the following is considered contractionary fiscal policy? The government increases defense spending due...
Why is the multiplier for a change in taxes smaller than for a change in spending?...
Why is the multiplier for a change in taxes smaller than for a change in spending? a. A change in taxes has no effect on aggregate demand, only on aggregate supply. b. A change in taxes directly affects government spending as well, lowering the multiplier. c. A change in taxes affects spending directly, but at a slower rate than spending does. d. A change in taxes affects disposable income and then consumption rather than spending directly. e. All of the...
The government budget balance is the... Difference between government outlays and tax revenues Change in the...
The government budget balance is the... Difference between government outlays and tax revenues Change in the government debt that results from changes in fiscal policy The budget balance that arises because Real GDP differs from Potential GDP The budget balance that occurs when the economy is at full employment
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to the right. tne long-run aggregate supply curve shifts to the left. C) the 20) When aggregate demand curve shifts to the left. the short-run aggregate supply curve shifts to the left. t spending without an accompanying increase 21) An increase in govenment spending n taxes demand A) does not increase aggregate B) would effectively eliminate an inflationary gap. Q mquires additional govemment borrowing spending...
1. GDP - annual debt
2. government spending - tax revenue >0
3.government spending - tax revenue <0
4. annual debt/GDP
5 annual deficit/GDP
6. total debt - debt held by us households and institutions
==================================================
A budget deficit is government spending in excess of what?
A.. tax revenues
B. real GDP
C. household spending
D. consumption
================================================
What would happen to the cyclical deficit if the GDP growth rate
jumped from 2 percent to 4 percent?
A.decrease in deficit...
MPC Spending Multiplier Change in income 100 20 0.99 0.95 0.6 0.5 Change in government spending $15 $100 -$400 $450 $1,500 $2,000 -$1,000 $900 2.5 2.0 4. Assume that the equilibrium in the loanable funds market is at interest rate of 1.25% and quantity of funds at $20 billion. Suppose the current government deficit is zero so government is not borrowing any money. a) Suppose now government increases spending by $2 billion and finances it entirely by borrowing. This deficit...
If the economy is close to full employment, an increase in government spending may increase GDP in the short run, but in the long run, this policy may: reduce investment in new capital. make domestic businesses less competitive in international markets if the dollar appreciates in value raise interest rates and reduce consumer expenditures on cars and new houses All of these options are correct Which of the following is considered contractionary fiscal policy? The government increases defense spending due...
Why is the multiplier for a change in taxes smaller than for a change in spending? a. A change in taxes has no effect on aggregate demand, only on aggregate supply. b. A change in taxes directly affects government spending as well, lowering the multiplier. c. A change in taxes affects spending directly, but at a slower rate than spending does. d. A change in taxes affects disposable income and then consumption rather than spending directly. e. All of the...
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