1.Which of the following is an example of an automatic stabilizer? The savings Unemployment benefits Autonomous public expenditure The multiplier effect

Which type of discretionary fiscal policy is likely to have the smallest overall effect on GDP because of the low MPC related to the policy?

How relevant is the multiplier concept to the implementation of expansionary andcontractionary fiscal policies?

Which of the following effects results from the change in the interest rate created by an increase in government spending?   a. the investment accelerator and crowding out   b. the investment accelerator but not crowding out   c. crowding out but not the investment accelerator   d. neither crowding out nor the investment accelerator

What is the difference between discretionary fiscal policy and automatic stabilizers? How are federal budget surpluses and deficits affected by the business cycle?

Answer exercises 11-14 on the basis of the following information. Assume that equilibrium real GDP is $800 billion, potential real GDP is $950 billion, the MPC is .80, and the MPI is .40.

3. The Government of Wonderland decides to adopt an expansionary fiscal policy increasing its expenditure (G) by $500 billion. They know that the value of MPC is 0.6. By how much should the economy be expected to expand? Answer Here: Gxmpc=$100X0.6 200 Will Crowding Out affect the final outcome of this move? Explain your answer Answer Here:

Please answer the question below: If the current real GDP is P700 billion, which of the following policies would bring the economy to potential output? a. increase government spending by P25 billion b. increase government spending by P100 billion c. increase government spending by P20 billion d. decrease government spending by P100 billion   If current real GDP is P700 billion, which of the following policies would bring the economy to potential output? a. decrease taxes by P100 billion b. increase taxes by P100 billion c. decrease taxes by P25 billion d. increase taxes by P25 billion * the attached photo is just connected to the question *

Which one of the following statements is TRUE about the concept of crowding out? Select one: a. Crowding out causes the textbook multiplier to become larger b. “Crowding out” occurs because the Fed increases money supply and  lowers interest rate c. “Crowding out” occurs because the Govt increases govt expenditures and this causes private consumption and investment to increase d. “Crowding out” occurs because the Govt increases govt expenditures and this causes private consumption and investment to decrease

The economy is experiencing negative GDP growth and high unemployment.  Which fiscal policy action should the government implement in an attempt to fix this problem?     A.) increase spending B.) raise taxes C.) increase the reserve requirement D.) decrease interest rates