Define saving and investment. Data for the simple economy of Newt show that in 2011, saving exceeded investment and the government is running a balanced budget.What is likely to happen ? What would happen if the government were running a deficit and saving were equal to investment ?

Q: When an economy is already at full employment, what is the outcome of expansionary fiscal policies…

A: The fiscal policy is an automatic stabilizing policy in which the government either use it spending…

Q: 21) "A $10 billion increase in taxes and a $30 billion cut in government spending" is the example of…

A: Fiscal policies are the ones that are related to the collection of revenue and decision of spendings…

Q: According to the traditional view on government debt, a tax cut without a cut in government…

A: The governments use fiscal and monetary policies to achieve certain economic goals. The fiscal…

Q: If income tax rates are increased in an attempt to balance the federal budget, we should expect to…

A: Income tax is tax on individual's income. The tax are levied in order to finance various project of…

Q: Explain how the conduct of fiscal policy affects consumption and investment in equilibrium.

A: Fiscal policy is a macroeconomic policy that is implemented by the government for monitoring and…

Q: Find the value of the primary deficit  if the fiscal deficit is 186 and the interest payment by the…

A: The variable that captures the borrowing requirements of the government other than the obligation…

Q: if the government faces a fiscal deficit of $ 100 million because it collects $100 million with 6%…

A: The fiscal deficit is the situation in which the government spending becomes higher than the…

Q: Explain, using appropriate diagrams, how a rise in the household saving rate can cause a fall in…

A: GDP is the value of final goods and services produced in the country within a given period of time.

Q: Which of the following is a TRUE statement about arguments for and against requiring a balanced…

A: When talking about balanced budget, it is the situation when government is spending exactly the same…

Q: In a situation of declining GDP, rising unemployment, and a budget that already has a small deficit,…

A: GDP refers to the measure of the welfare of the economy where it is the value of all the finished…

Q: Suppose the US Federal Government decides to increase its spending without issuing debt by raising…

A: In short run, if taxes are imposed, that will raise the price above initial equilibrium level. If we…

Q: An appropriate way for the government to help stabilize economic activity consists in   Select one…

A: In order to stabilize the economy, the government should change its spendings according to the…

Q: Briefly discuss the effects of time lags in relation to fiscal policy, including: a comparison to…

A: ‘Fiscal policy’ refers to the use of ‘government revenue collection’ & expenditure to influence…

Q: Government spending in Robok is $90 billion, and its only tax is an income tax with a marginal tax…

A:

Q: Suppose the US Federal Government decides to engage in deficit spending whereby it increases its…

A: A budget deficit may result in public sector debt, and also a rise in the national debt.

Q: Which of the following statements about how fiscal policy should most appropriately be used in a…

A: The fiscal and monetary policies are used by the governments to achieve certain economic goals. The…

Q: Fiscal stance refers to: Select one: A. A government that takes a tough stance when it comes to…

A: Fiscal policy refers to government actions that result in a change in the level of economic activity…

Q: Please show a diagram showing fiscal stimulus impacting on an economy where household saving is on…

A: Fiscal stimulus is defined as the fiscal policy measures taken by the government to boost the…

Q: In 2019, the government collected $550 billion in taxes and the government had a $120 billion budget…

A: Budget Deficit occurs when government spending exceeds the revenue collected by government. Budget…

Q: Assume today is October 20, 2021. In which quarter of fiscal year 2022 is the federal budget?

A: The federal budget is the government's estimate of revenue and spending for each fiscal year. The…

Q: Use the aggregate expenditures model to show how government fiscal policy could eliminate either a…

A: Meaning of Aggregate Demand and Aggregate Supply: The term aggregate demand refers to the…

Q: Which of the following sentences correctly describes the budget of the Federal Government of the…

A: The budget deficit states that the government's expenditure surpasses the government's revenue. The…

Q: Which of the following policy combinations would cause a rise in the government budget deficit?…

A: Fiscal measures is the utilization of government spending and tax collection to impact the economy.…

Q: A government spends $500,000 as an expansionary fiscal policy. The spending multipler is 2. a) if…

A: Changes in the price level, affects the spending multiplier.

Q: Assume that the economy is facing a GDP gap. 1. Write a report explaining why that might have…

A: There are two types of GDP gaps i.e. rrecessionary output gap and the inflationary output gap. In…

Q: In a closed economy, if Y is 12,000, T is 1,000, G is 3,000, and C is 5,000, then the government has…

A: A closed economy is one that has no trading activity with outside economies. The closed economy is…

Q: Some politicians have suggested that Conada enact a constitutional amendment requiring the federal…

A: A government budget is a paper prepared by the government and/or other political body that presents…

Q: If the government increased spending by $8 million as part of expansionary fiscal policy, calculate…

A: MPC is the marginal propensity to consume, which is the proportion of change in income spent on…

Q: Which of these is MOST LIKELY to occur after the government increases taxes?   A.) Consumer…

A: When taxes are increased, consumers' spending reduces as disposable income falls. Consumers are left…

Q: Between 1998 and 2000, the U.S. government had higher revenue than spending. Which of the following…

A: National debt in period N = National debt in period (N - 1) + Increase in budget deficit (- Decrease…

Q: (Fiscal Policy) Define fiscal policy. Determine whether each of the following, other factors held…

A: Answer- Fiscal Policy - This is a policy which a government adjusts its spending levels and tax…

Q: The imaginary country of Acordia lists the following projected revenues and outlays for 2020: $30…

A: The government will suffer from budget deficit when the total expenditure of the government exceeds…

Q: In a closed economy, GDP is $1000, government purchases are $200, and consumption is $700. If the…

A: In Keynesian macroeconomics when the price level in the economy is assumed to be fixed then planned…

Q: given that,  consumption is C=100+0.75Yd Taxes is T=50+0.5Y Export is X=200 Import is M=50+0.25Y…

A: consumption is C=100+0.75Yd Taxes is T=50+0.5Y Export is X=200 Import is M=50+0.25Y Government…

Q: If Investment = f(r*) a.  Explain with pictures how it affects the balance of Supply/Saving and…

A: The economies around the world tend to work upon the basis of the working of various economic…

Q: The government has many tools at its disposal to help create stability for an economy. Explain the…

A: The use of government spending and taxation for influencing the economy is known as fiscal policy.…

Q: What is the impact of using Fiscal policy tools on an economy - more specifically aggregate demand…

A: The aggregate demand is the aggregate demand of all the goods and services produced in the economy.…

Q: Government spending in Robok is $140 billion, and its only tax is an income tax with a marginal tax…

A: here we calculate the following terms by using the given information , so the calculation of the…

Q: The budget function for the economy of Sunsville is T - G = -400 + 0.25Y. a) Suppose income is…

A: Given the budget function of Sunsville: T-G=-400+0.25Y        ... (1)   When the value of T-G is…

Q: Many countries have constitutional requirements that their budgets be in balance (or in surplus) in…

A: A balanced budget refers to when, during a given period, the government spends an amount equal to…

Q: Crowding Out and Capital Formation) In earlier chapters, we’ve seen that the government can try to…

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Q: If this year, the government collects £250bn in taxes and spends £400bn, it must have a  a) budget…

A: In this question, we have to tell whether the economy will have a budget deficit or budget surplus…

Q: In case the government is experiencing deficit in its budget, it resorts to borrowing to close the…

A: The budget deficit is an excess of government (G) expenditure over G revenues. To close the deficit,…

Q: The government budget is in DEFICIT when     T - G - Transfers (TR) - Interest on the Debt (INT)…

A: A government deficit is the amount of money in the budget by which the spending done by the…