Countercyclical fiscal policy consists of using an expansionary fiscal policy during and a contractionary fiscal policy during O a) economic downturns; economic expansions Ob) periods of rapid economic growth; periods of slow economic growth Oc) political stability; political unrest d) times of low unemployment; times of high unemployment e) times of high inflation; times of low inflation

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

Which of the following statements regarding government fiscal policy are correct? Assume ceteris paribus. a) The government's debt to GDP ratio will be increasing if there is a primary budget deficit. + b) Higher spending on interest payments increases government debt but does not increase the primary deficit. c) In a recession, a government using fiscal policy to stabilize aggregate demand will design its policy to override the automatic stabilizers. ◆ +

Please match each description with the appropriate approach to federal finance. Policymakers should reduce spending and increase taxes when the economy is growingin order to prevent "overheating". This approach was considered conventional wisdom until the advent of theGreat Depression. Policymakers should focus on keeping unemployment low and providing the peoplewith the public goods and services they want. If insisted upon, this approach would only worsen the economy during a recession. This approach ignores the impact of the budget on the business cycle.

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

please answer the following question: 1.The fact that it takes time for government officials to recognize an economic problem in is one reason for time lags in fiscal policy making. a)true  b)false

If expansionary fiscal policy is used following a supply shock such as the one experienced during the Covid-19 pandemic, the expansionary fiscal policy will result in real GDP ________ and the price level ________. decreasing; increasing increasing; decreasing increasing; increasing decreasing; decreasin

When GDP and incomes are high, the government collects more dollars in tax revenue. When they're low, the government collects fewer tax dollars. These higher and lower amounts help even out the economy without having to wait for changes in tax rates or other legal matters. For these reasons, tax revenues (not rates) are best described as automatic stabilizers. contractionary fiscal policy monetary policy O the marginal propensity to consume

For each of the following scenarios, determine which time lag is most likely to result when designing and implementing fiscal policy. a. The separation of power demonstrated between the legislative and executive branches of government combined with strong partisanship attitude among our elected politicians. . . . . b. The fact that it takes economists working for the National Bureau of Economic Research months to declare the dates of peaks and troughs. . . . Recognition lag Legislative lag Implementation lag All of these lags c. The time it takes to design and build new infrastructure after these projects have been passed by the legislature. Recognition lag • Legislative lag . Implementation lag All of these lags . Recognition lag Legislative lag Implementation lag . All of these lags

a) What are the three fiscal policy tools and how would each be used to counter a contractionary gap?   b) True or False and explain: Fiscal Policy is effective at reducing the duration of an economic contraction.   c) True or False and explain: Households always react to tax changes in a predictable manner.