Question

10 pts Question 20 U Throughout the course, we have see how government policies have had important implications for economic outcomes. Give a example in which government policies can help and an example of when government policies can make things worse. BIVA-A- IE * . XX, E - 2 x 12pt Paragraph

Answer 1

1 An economic policy is ourse of a etion that is intended to influence control the behavior of economy. Economic policy implemented administered are typically by the government. eco- Government policies to increase focussed ar homic on growth trying to cutting increase aggregate demand e demand ( dem and side) policies or increase aggregate supply / productivity ( supply side policies). Demand side policies include : fiscal policy taxes, increasing gover mment spendings monetary policy (cutting supply side policies include: privatisation, de regulation, tax cuts, free agreements Improved education of train interest rates) o trade aining improved 2 infrastructure,

2 its sometimes policies implemented by the government leads to own problems. The government may take decisons for short term political consideration which lead outcome. to an in efficient prot totect eig Government tanffs to domestic industry spart off a trade war, where economy contracts