In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals. Raising taxes by the US government is an tool of Monetary policy Fiscal policy Accommodation policy Interest rate policy

In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals. Raising taxes by the US government is an tool of Monetary policy Fiscal policy Accommodation policy Interest rate policy

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter30: Government Budgets And Fiscal Policy

Section: Chapter Questions

Problem 30RQ: Under what general macroeconomic circumstances might a government use expansionary fiscal policy?...

See similar textbooks

Related questions

Q: they must be willing to accept a higher rate of unemployment.

A: Explanation: A contractionary policy refers to the government or financial organization's actions…

Q: One of the three main tools of the Federal Reserve is fiscal policy. True False

A: Central Bank: The central bank is the apex bank of the country that supplies the money or maintains…

Q: The political business cycle refers to The ups and downs in the overall business activity of…

A: Political economy is a discipline of social science that studies the interactions between people,…

Q: Which of the following is a false statement?

A: An expansion/ boom can be stabilized/fixed by following expansionary fiscal policy. TRUE…

Q: An intended goal of expansionary fiscal policy and an easing of monetary policy is Select one: a.…

A: Hey, Thank you for the question. According to our policy, we can only answer 1 question per session.…

Q: As a result of an economic policy change, interest rates and consumption rise but investment falls.…

A: Fiscal and monetary policies are two main tools to correct the economic imbalances . Where expansion…

Q: Differentiate between the following terms. Expansionary fiscal policy and expansionary monetary…

A: Expansionary fiscal policy is the policy which focuses on increasing aggregate demand by increasing…

Q: The Board of Governors: Question 6 options: are appointed by the U.S. president and confirmed…

A: The Federal Reserve is the central bank of the United States of America. It operates under a…

Q: When a central bank uses its powers over the banking system to engage in “against the business…

A: Monetary Policy refers to a policy that influences the economy by manipulating the banking system's…

Q: In the short run, a rise in the federal funds rate ________ the price level and ________ real GDP.…

A: In the short run when the federal funds rate increase so investment falls and so does output and…

Q: Fiscal Policy instruments include: a) quantitative easing b) money supply manipulation c)…

A: Fiscal policy is such a policy which is framed by the government that account for government…

Q: Suppose the Central Bank of Bothnia buys Treasury Bonds. What will be the impact on the price level…

A: The fiscal and monetary policies are used by the government to achieve certain economic goals. The…

Q: In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals.…

A: Fiscal approach is generally founded on the thoughts of British market analyst John Maynard Keynes…

Q: QUESTION 3 Tools used by the central bank to control the quantity of money is called Fiscal Policy.…

A: Policies refer to the action plans undertaken by the central bank and the government of the nation…

Q: What is the Difference between Monetary & Fiscal Policy Fiscal Policy Monetary Policy Who? Who?…

A: Who?Fiscal policy decisions are made by congress and the presidentStatement 6th Monetary policy…

Q: If the government decides to raise taxes to prevent inflation, this is an example of a) monetary…

A: Inflation can be combated by decreasing the aggregate demand.

Q: Which of the following is an example of monetary policy? The government cuts taxes Defense spending…

A: In the event of a recession, the government uses an expansionary monetary policy to increase the…

Q: In the monetary perspective: -Discretionary monetary policy is the most effective way to moderate…

A: Monetary policy: The monetary policy is adopted by the central bank to endure the price stability…

Q: A monetary policy that successfully offsets a recession also has the effect of lower output than if…

A: Monetary Policy is the policy through which quantity of the money of the economy is controlled,…

Q: Governments are responsible for maintaining full employment, price stability, and economic growth –…

A: Stimulative monetary policy of united states is the monetary policy in which policy is adjusted…

Q: To fix a negative supply shock in an economy, ___________should be used. a. contractionary…

A: The economies around the globe are focused on maximizing the level of their growth, and development.…

Q: _________________ formulates fiscal policy and _______________ formulates monetary policy (what…

A: Fiscal policies refers to policies formulated by the government which influence an economy through…

Q: Describe the fiscal stimulus packages and monetary policy interventions initiated by policymakers in…

A: The main aim of the fiscal stimulus package is to boost economic growth by creating employment…

Q: Explain each of these statements supported by reasonable reasoning: 1. Credibility is important…

A: When product is manufactured, cost takes place along with revenue, which results into profit and…

Q: Identify the circumstances under which budget deficits can lead to inflationary monetary policy.

A: A deficit occurs when expenses exceed revenue and indicate the financial health of a rustic. the…

Q: This is a true statement about monetary and fiscal policy: The Medicare program is fiscal policy…

A: Disclaimer- “Since you have asked multiple question, we will solve only first question for you as…

Q: Fiscal policy consists of tools used by the Central Bank to control the quantity of money in the…

A: Fiscal policy is the policy in which government modifies the spending levels and taxes to control…

Q: Monetary policy is subject to longer ________ lags than fiscal policy. A. Decision and…

A: The time it takes for the government and central bank to react to an adverse macroeconomic event…

Q: 18. "Liquidity trap" was a problem of a) monetary policy of Japan and Sweden. b) fiscal policy in…

A: Liquidity trap refers to the situation when a country is facing an ineffectiveness of the policy to…

Q: The Fed is an agency of the U.S. Treasury Department that has the responsibility of collecting tax…

A: Central Bank: A central bank is the most elevated monetary organization in a financial framework…

Q: An increase in the budget deficit is the result of: choose the correct answer (a) Expansionary…

A: A budget deficit happens when government expenditure surpasses income and demonstrate the economic…

Q: Fiscal policy refers to a) the spending and taxing policies used by the government to influence the…

A: Governments' economic policy encompasses taxation, budgeting, the money supply, and interest rates,…

Q: When real GDP is greater than potential output, it is most likely that the Fed will engage in…

A: There are two types of output: 1. Real output/GDP 2. Potential output/GDP

Q: Congress Central Bank- The Federal Reserve Changes the Money Supply & Interest Rates The Federal…

A: Fiscal policies are used by the government and monetary policies are used by the central bank.

Q: Fiscal and Monetary Policies are different in that a)Only fiscal policy tools may include taxation…

A: Fiscal Policy refers to the policy where there is no central banks intervention and used by the…

Q: One of the advantages monetary policy in relation to fiscal policy is that: a. It is easier to…

A: Monetary policy : The Monetary policy of the central bank of a country is to control money supply…

Q: Match each tool with the appropriate policy decrease the reserve ratio increase taxes sell bonds…

A: Expansionary fiscal policy is to decrease tax or increase spending or both 4th and 6th statement

Q: Expansionary monetary policy is when: None of the statements are correct. The president and congress…

A: Monetary policy refers to the policy of central bank that changes the cost and availability of…

Q: Monetary and fiscal policy making that is carried out in response to a pre-set rule and does not…

A: A discretionary fiscal policy is implemented in response to a certain economic shock. But…

Q: Assume the U.S. economy is already operating above the full-employment level of GDP (i.e., above…

A: The agreement gauge across models is that the tax breaks raised genuine total national output (GDP)…

Q: econ

A: Fiscal policy is the use of tax policies and government spending in order to influence conditions of…

Q: In the short run, expansionary monetary or fiscal policy is expected to O increase; decrease.…

A: Expansionary monetary policy is implemented by the central bank to increase the money supply via…

Q: Which of the following was not one of Reagan's four major policy objectives? Reduce federal income…

A: The policies that are being characterized and are being associated commonly with the supply side of…

Q: The 'automatic mechanism' can best be described as using fiscal or monetary policies to stabilize…

A: Automatic Mechanism is also known as self correction.

Q: Classify each statement as an example of expansionary fiscal policy, contractionary fiscal policy,…

A: Fiscal Policy: Fiscal policy is part of economic policy through which the government maintains the…

Q: If the Fed overcorrects the economy during a period of decreased consumer spending...... )…

A: Recession A considerable decrease in overall economic activity in a particular area is referred to…

Q: Country Y is experiencing severe and unanticipated inflation. Identify one fiscal policy action…

A: Fiscal policy is related to making modifications in expenditure and tax size with a view or motive…

Question

In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals. Raising taxes by the US
government is an tool of
Monetary policy
Fiscal policy
Accommodation policy
Interest rate policy

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Under what general macroeconomic circumstances might a government use expansionary fiscal policy? When might it use contractionary fiscal policy?
Exercise D24 Compare two policies: a tax cut on income or an increase in government spending on roads and bridges. What are both the short-term and longâ€”term impacts of such policies on the economy?
learn-us-east-1-prod-fleet01-xythos.content.blackboardcdn.com Bb https://.. a SD Bb Bb Bb 1. From the time of George Washington's presidency to the present, the percentage of the average American's income that goes to pay taxes A. has decreased from about 20 percent to about 10 percent. has decreased from about 50 percent to about 25 percent. C. has remained constant at about 10 percent. D. has risen from less than 2 percent to above 45 percent. Е. В. has risen from less than 5 percent to above 25 percent. 2. According to the textbook, which of the following statements is (are) correct for the United States? (x) The individual income tax and the payroll tax are the two largest sources of revenue for the U.S. federal government. (y) Corporate income taxes and excise taxes make up more than 30 percent of the tax revenue for the U.S. federal government. (z) In general, the two most important taxes for state and local governments in the U.S are sales taxes and property taxes. А. (x), (y)…
consumers increased consumption by a relatively small amount in 2008 and 2009 because thet believe the tax cuts temporary. true or false
EXPANSIONARY FISCAL POLICY 20% GOVERNMENT SPENDING 80% TAKATION Gvemme Spnding Taationmater than pter than tation apud How will Expansionary Fiscal Policy affect the Federal Budget? A budget surplus will decrease the national debt Deficit spending will decrease the national debt Deficit spending will increase the national debt A budget surplus will increase the national debt
←05 Survey Junkie 17 Gmail C https:/Assign W 2 https://highschools.foolproofonline.info/modules/taxes/board13.php YouTube Maps Dashboard - HMH Ed Okay, more Practice Questions: This is: Identify the type of tax for each example. Example 1: You are charged this tax by the federal government on your yearly pay. O Income Tax. O Sales Tax. O Property Tax. O Excise Tax. This is: Example 2: You own a piece of property and receive a tax bill from the state each year. O Income Tax. O Sales Tax. O Property Tax. O Excise Tax. EN Anglais (ats-Unis) E $ 4 0.6.76 Edmen w foolpro Cc X R 5 T Y & 7 F9 8
Using a hypothetical demand and supply equations explain what would happen ifgovernment imposes an indirect tax (assume a value) on the product. Find the newequilibrium, change in consumer and producer surplus and amount of governmentrevenue and DWL. Under what conditions consumers will bear of the tax burden? Underwhat conditions producers will bear of the tax burden?
Describe the three distinct terms to describe the tax rates?
Social Security and Medicare create a fiscal gap because _______. A. the benefits today exceed the tax revenues to support these programs B. outlays on these programs today minus tax revenues contribute to the government budget deficit C. future generations will have to pay for the benefits received by the current generation D. the present value of current and projected future outlays exceeds those of future tax revenues
What is the difference between indirect taxes and net indirect taxes? Macro economics
f Congress and the president decide an expansionary fiscal policy is necessary, then they should target higher interest rates by decreasing the money supply. enact policies that increase government spending and decrease taxes. Oenact policies that decrease government spending and increase taxes. O target lower interest rates by increasing the money supply. 2001-20 Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Give a brief definition of fiscal policy? What are its economic goals? Fiscal policy is the use of the federal budget to achieve f _____ e___________, c________ i___________, and stimulate e__________ g________. The changes to the federal budget can be made through increases or decreases in g______________ s_________ (G) or through increases or decreases in t______ rates (T).