Does the government have the capability to use both G and T to stabilize the economy?...
Does the government have the capability to use both G and T to stabilize the economy? When? Give a real example for a case occured in the globe?
Homework Answers
Government can stabilise the economy by reducing taxes(T) and inducing higher spending (G) through expansionary fiscal policy as we saw in India where corporate taxes and income tax were cut, and government spending increased on all sectors and thus, the real GDP grew.
This occurs when recession fears keep looming and government troes to revive slowdown.
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Does the government have the capability to use both G and T to
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