Explain the effect, if any, that each of the following occurrences should have on the aggregate demand curve. a. The Fed lowers the discount rate. b. The price level decreases. c. The federal government increases federal income tax rates in an effort to reduce the federal deficit. d. Pessimistic firms decrease investment spending. e. The inflation rate falls by 3 percent. f. The federal government increases purchases to stimulate the economy.

Assume that a hypothetical economy with an MPC of 0.8 is experiencing severe recession Instructions: In part around your answers to 2 decimal places. Enter your answers as positive numbers in part enter your answers as whole numbers. a. By how much would government spending have to rise to shift the aggregate demand curve rightwerd by 50 S 10.00 bilion How large a tax cut would be needed to achieve the same increase in aggregate demand? $ 13 billion b. Determine one possible combination of government spending increases and tax increases that would accomplish the same goal without changing the amount of outstanding debt e, maintaining the budget balance at its current value) billion Increase spending by Increase taxes by bilion Save & Ext

'Finance minister announces that the federal income-tax rate will rise by three percentage points." Assuming that aggregate output is demand-determined, the AE function will and equilibrium national income will O a. Become flatter; fall. O b. Shift up parallel to itself; rise. Ос. Весome steeper, rise. O d. Shift down parallel to itself; fall. O e. Not change; not change.

pls answer urgent all question Q1,a,b,c . Q1-Suppose the government reduces taxes by $20 billion, that there is no crowding out, and that the marginal propensity to consume is ¾. a. What is the initial effect of the tax reduction on aggregate demand? b. What additional effects follow this initial effect? What is the total effect of the tax cut on aggregate demand? c.How does the total effect of this $40billion tax cut compare to the total effect of a $40 billion in governmentpurchases? Why?