If the government announces that it has increased the corporate tax rate from 25% to 35% and the income tax rate from 20% to 30%, what kind of policy will it follow? A) contractionary fiscal policy B) Supply-side policy C) contractionary monetary policy D) Expansionary monetary policy E) Expansionary fiscal pol

Q: If the economy is in stagflation, what would eventually happen as a result if no fiscal policy is…

A: Stagflation refers to the economic condition where the inflation and stagnation both exist…

Q: What are the strengths and weaknesses of fiscal policy and monetary policy.

A: Policy are the plans made by government for the betterment  of state or country. policy is law,…

Q: 1. If a government runs a primary fiscal deficit, and has no source of additional revenue other than…

A: Fiscal deficit refers to how much a government's spending exceeds its revenue during a fiscal year.…

Q: 6. A reduction in government expenditure or an increase in taxes is defined as: 1. expansionary…

A: We know that Expansionary policy is employed with the aim of boosting aggregate demand when private…

Q: 12. Using fiscal policy to fight inflation Consider the hypothetical economy depicted on the graph.…

A: Full employement level prevails at : Price level = 110 & Real GDP = $780 billionIn the initial…

Q: 8 How is the above stimulus bill going to be financed? According to the (Keynesian) theory in the…

A:

Q: 1. If the government is required to balance the budget and the economy falls into a recession, which…

A: 1. If the government is required to balance the budget and the economy falls into a recession, the…

Q: 9. Use of discretionary policy to stabilize the economy Should the government use monetary and…

A: The contractionary policy must be used as economy is experiencing expansionary gap. It will shift…

Q: 2 - D please

A: The demand curve shows the inverse relationship between price and quantity demanded. The demand…

Q: Interest rates are a key weapon in fiscal policy Select one: a. False b. True

A: Fiscal policy is aimed at affecting the economic activity through fiscal tools. These tools include…

Q: 14) The relationship between monetary policy and the time it takes for policy to change spending is…

A: The monetary policy is the policy of the monetary authority of the economy regarding the money…

Q: 3*********************   3)List the five most powerful changes to fiscal policy that you would…

A: Fiscal reform refers to changes or adjustments made to a country's fiscal policies, which involve…

Q: According to Classical economists, which type of fiscal policy financing produces "crowding out? a.…

A: Fiscal policy implies the use of government expenditure or tax revenue in order to change the…

Q: Exercise 4 Use a combination of text and drawing of figures when answering the following questions:…

A: Fiscal policy Fiscal policy refers to the policy of the government and central bank of the nation…

Q: an economy moves into a recession, causing that country to produce less than potential

A: Automatic stabilizers refer to the inbuilt mechanisms in a government budget.

Q: 9.Fiscal policy can be called on to correct conditions of recession and inflation.  a.List and…

A:

Q: What is the role of the fiscal multiplier in economic stimulus packages, and how does it contribute…

A: The fiscal multiplier is a basic concept in macroeconomics, especially pertinent while examining…

Q: 5. Aspects of fiscal policy Suppose the economy had been producing at potential output but is now…

A: The discretionary fiscal policy is nothing but the government makes to change the tax rates and…

Q: _____ are elements of fiscal policy that automatically change when income changes.   a. Budget…

A: Fiscal policy is one of the tools of the government to influence macroeconomic conditions such as…

Q: Suppose the economy is in a recession, which of the following fiscal policy can the government use…

A: A recession is a macroeconomic word for a large drop in overall economic activity in a certain area.…

Q: .When an economy has an aggregate expenditure of $150 billion and the real GDP of $140 billion, then…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: 1. The cyclically adjusted surplus as a percentage of GDP is 1 percent in year 1. This surplus…

A: Gross domestic product refers to the market value of final goods and services that are produced…

Q: please answer the following question: 1. Suppose an economy is slowing and more and more people…

A: "In an economy which is slowing down, the nation's government make use of fiscal policy to stimulate…

Q: 10. Describe the characteristics of fiscal policy from 2000 to 2018. a. From 2000 to 2004, fiscal…

A: since you have asked a multipart question and according to our policy we can only solve the first 3…

Q: 1. Consider a profit-maximizing firm that manufactures bolts in a perfectly competitive market and…

A: Here, the given graph shows the price, quantity and cost curves of a bolt manufacturing firm, which…

Q: 1. Given the discussion of the effects of fiscal policy in this​ chapter, if the central bank does…

A: Fiscal policy refers to the use of government disbursement and tax policies to influence economic…

Q: 14. During a period when economic growth is very strong and inflation rates are rising to…

A: Since you have asked multiple questions, we will solve first question for you . If you want any…

Q: iscal policy affects aggregate demand because:   government spending is a category of aggregate…

A: Fiscal policy involves the use of taxes, government spending, and transfer payments to promote…

Q: 1. Since 2010, the UK government has made some progress in reducing the budget deficit by…

A: A government generally regulates the market through fiscal measures, the measures can be of two…

Q: 1. What is a minor but important change you would like to see applied to fiscal policy? 2. What is…

A: Here we need to address the changes in fiscal and monetary policy which will increase the…

Q: reduction in government expenditure or an increase in taxes is defined as:

A: Expansionary policy is employed with the aim of boosting aggregate demand when private demand is…

Q: 9. Use of discretionary policy to stabilize the economy Should the government use monetary and…

A: The economy is producing natural rate of output at long run aggregate supply curve.

Q: to 2002 c. 2002 to 2003

A: Contractionary fiscal policy is when the government either tends to raise taxes or cut spending.It…

Q: After many years of budget surpluses, why did the government drastically increase spending in 2009?

A: in 2008 and 2009 global economy was experiencing what we called great recession it started since…

Q: 07. What factors make an expansionary "stimulus" fiscal policy effective?     a) A government…

A: Fiscal stimulus can raise output and incomes in the short run. To have the greatest impact with the…

Q: Which organisation controls fiscal policy in Australia? Select one: O a. The Reserve Bank of…

A: Money supply is the quantity of liquid money such as cash and checkable deposits in the economy at a…

Q: Suppose that Shen, an economist from a research facility in Washington, and Valerie, another…

A: A budget deficit happens when a government's expenditures more than its revenues in a given fiscal…

Q: According to Classical economists, which type of fiscal policy financing produces "crowding out? a.…

A: Crowding out refers to the procedure where increases in government spending decreases other…

Q: For questions 34-39 choose whether each is an example of: fiscal policy a. discretionary b.…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: 7. Use of discretionary policy to stabilize the economy Should the government use monetary and…

A: Discretionary policy is a macroeconomic policy that is chosen by policymakers' judgement in the…

Fiscal Policy and Money Market

Fiscal policy is one of the important tools that is used by the government to control inflation or aggregate demand in the economy. Under this policy, there are two rules which are used by the government, one is the expenditure of the government and the other is the taxation or income of the government which it collects from the public.