Congress increases personal income tax rates to balance the budget. Automatic stabilizers will the in aggregate demand. increase; expansionary; increase decrease; expansionary; increase increase; contractionary; decrease decrease; contractionary; decrease the effect of

Congress increases personal income tax rates to balance the budget. Automatic stabilizers will the in aggregate demand. increase; expansionary; increase decrease; expansionary; increase increase; contractionary; decrease decrease; contractionary; decrease the effect of

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Congress increases personal income tax rates to balance the budget. Automatic stabilizers will
the
in aggregate demand.
increase; expansionary; increase
decrease; expansionary; increase
increase; contractionary; decrease
decrease; contractionary; decrease
the
effect of

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Which of the following statements about automatic stabilizers in Canada is the most accurate? They are the responsibility of the provinces since they, unlike the federal government, do not face lag problems. They are controlled by the Bank of Canada to help manage the business cycle. They are able to completely eliminate all the lag problems associated with fiscal policy. They are changes in government transfer payments and tax revenues that vary automatically and inversely to business cycle changes.
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Suppose that an economy is in equilibrium at a level of output of $600 million. Suppose further that the full employment level output is $2000 million. What can the President along with Congress do in order to attain the full employment output? Group of answer choices Increase the taxes. Decrease the taxes. Sell government securities. Decrease the government spending.
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