The notion that the government doesn't require taxes to finance expenditures is absolutely false because of the fact that the tax actually get to generate revenue and this is used for the expenditure purposes where it can be mentioned that selling bonds and living taxes can get to generate revenue discourage negative behaviour as well as redistribution of wealth by reducing economic inequality and this is the role of taxes in the government economy and spending
1. If the government does not need taxes and bonds to finance its expenditures, why then...
1. If the government does not need taxes and bonds to finance its expenditures, why then does it levy taxes and sell bonds? What is the role of taxes and government spending?
1. What should a government do with its spending and taxes during a recession? Why? 2. What should a government do with its spending and taxes during an upturn in the business cycle? Why?
Should the public through bonds and/or taxes finance stadium and arenas? Why or Why not?
Related to the Economics in Practice Federal government expenditures and receipts for the simple economy of the nation of Topanga are listed in the table below. The government of Topanga would like to reduce the debt-to-GDP ratio, and the Finance Minister of Topanga has proposed the following: "The best way to reduce the debt-to-GDP ratio is to increase GDP, because with a larger GDP, the ratio will have to get smaller. I therefore propose that government expenditures be increased by...
IS-LM What combination of policies would best reduce inflation? a) Increase taxes, sell government bonds b) Decrease taxes, buy government bonds c) Decrease taxes, lower the reserve ratio d) Decrease government spending, lower the discount rate e) Increase government spending, raise the discount rate Use the IS-LM model. Your policy instruments are: Taxes, Government Spending, and the Money Supply. Describe a policy or set of policies that achieve the following objectives. Your answer should include a diagram to show how...
Aggregate expenditures If the government does not take taxes from citizen (like in some Gulf count but only spends G, then the Equilibrium output level
Suppose the government decides to reduce both government expenditures and taxes by the same amount (this is a “balanced budget” change). What happens to: (i) national saving; (ii) the real interest rate; (iii) investment; (iv) consumption; and (v) output? Illustrate graphically using the The loanable funds market graph and explain in words why these variables change or why they do not change.
What item or product does the government sell? How does the government get money to spend? How do taxes fit into fiscal policy and if taxes cannot be raised, what does that mean for the debt level of the US? Are the bonds from the debt sold out of the New York Fed? Who are the bonds sold to?
Why does a $1 increase in government purchases lead to more than a $1 increase in income and spending? O O A Through the government purchases multiplier, the $1 increase in government spending will lead to a decrease in aggregate demand and national income, which will lead to a decrease in induced spending B. Through the government purchases multiplier, the $1 increase in government spending will lead to an increase in aggregate demand and national income, which will lead to...
sing and government purchases are leakages. 8. In a mixed closed economy: A taxes and government purchases are leakages, while investment and saving are injections. • taxes and investment are injections, while saving and government purchases are leakages. taxes and savings are leakages, while investment and government purchases are injections. 1. government purchases and saving are injections, while investment and taxes are leakages. 9. In a mixed open economy, the equilibrium GDP is determined at that point where: A.S. +M+...