Assuming the economy is in long run and the govt implemnents a tax cut of $420 Billion, there is no crowding out, and marginal propensity to consume is 0.9 what's the initial and total effect of the tax reduction on aggregate demand? Is there a formula to calculate this?

According to supply-side fiscal policy,lower taxes encourage work, saving and investment.Why? Can you explain this theory?

To enact Contractionary Fiscal Policy, the federal government must be running a budget ___________.

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

In Paynia  the marginal propensity to consume is .6.  Times are tough and the economy is operating on the flat ("Keynesian") range of the Aggregate Supply Curve.  If Congress wished to increase Aggregate Demand by $500 B, how much would it need to raise Government Spending, all else constant?

Suppose there are both multiplier and crowding out effects but without any accelerator effects. An increase in government expenditures would    a. always shift aggregate demand right by a smaller amount than the increase in government expenditures.     b. always shift aggregate demand right by a larger amount than the increase in government expenditures.     c. shift aggregate demand right by a larger, equal, or smaller amount than the increase in government expenditures.     d. always shift aggregate demand right by the same amount as the increase in government expenditures.

Suppose actual real GDP is $7.87 trillion, potential real GDP is $14.36 trillion, and the marginal propensity to consume is 0.61. If we ignore price effects, by how many trillions of dollars should the government change its lump sum taxes to fix the gap? (Round this to two digits after the decimal and enter this value as either a positive value or a negative value without the dollar sign.)

Suppose actual real GDP is $9.06 trillion, potential real GDP is $6.42 trillion, and the marginal propensity to consume is 0.59. If we ignore price effects, by how many trillions of dollars should the government change its lump sum taxes to fix the gap? (Round this to two digits after the decimal and enter this value as either a positive value or a negative value without the dollar sign.)

Why do Republicans like tax cuts? Why are tax cuts a good thing? How does it affect the aggregate supply and demand graph?

What do you understand by the term Fiscal Policy?