Assume the United States has been in another recession for the past 10 months. Unemployment is 10% and GDP has dropped $1.9 trillion from its previous peak of $ 20.5 trillion. The housing and heavy equipment industries have been hit the hardest Inflation has been near the 2% target but has started to dip below. Also, the countries average MPC is 60. Determine the best fiscal policylstrategy to help the economy recover and explain why it is the best choice. Be sure to reference Aggregate Demand and Aggregate Supply and explain your specific tools in your answers.

Assign the correct label to the corresponding events/ policy actions that occurred during the 2007–2011 time period.
Events/policy actions: TARP, the 2009 stimulus package, the 2010 extension of the Bush tax cuts, the reduction in taxes most Americans paid because they had less income than they would have had. Label: discretionary fiscal policy, non-discretionary fiscal policy?

The economy is experiencing a contraction (recessionary gap) of $400 billion. What government spending stimulus would you recommend to move the economy back to full employment if the MPC is 0.75? Would your policy be any different if the MPC were 0.66?

Suppose the economy begins at full employment. Label this starting point as point "1." Then, suppose that a long strike by coal miners reduces the coal supply and increases the price of coal. Show the effects on your graph and label the new equilibrium point "2." Lastly, suppose our government wants the economy to return to full-employment as quickly as possible. Should the government intervene? If so, show the impact of successful fiscal policy on your graph. Label this new equilibrium point "3."

President Biden is proposing an increase in the corporate income tax rate from 21% to 28%. Although the corporate tax rate will be higher than it is currently, it is still lower than the corporate tax rate of 35% that had been in place since President Clinton. How will this tax increase affect aggregate expenditures, equilibrium GDP and employment? Part of the reason for this proposal is to offset the increased spending from the last three stimulus packages/checks which increased Federal government's debt.  Do you agree with the proposed increase in corporate tax rates? Why or why not? What are some of the costs and benefits of the proposed tax changes? Is this the right time to increase taxes? Why or why not?

In regards to time lags as they relate to Fiscal Policy, which lag is possibly the longest and most troublesome? Decision Lag Information Lag Recognition Lag Implementation Lag

What specific fiscal policy tools would you use to stimulate aggregate demand and how? also include the references for my research later on.

my choice is incorrect

Consider a potential fiscal policy used to curb a recession. How could a consumer and business expectations about the future economy could hamper those plans?

If a recession persists due to nominal wage and price stickiness (i.e., slow adjustment of nominal wages downward), what kind of fiscal policy can bring us out of this recession?     decreased government expenditures and increased taxes   increased government expenditures and decreased taxes   decreased government expenditures   contractionary fiscal policy