If the MPC in an economy is 0.6, government could shift the aggregate demand curve rightward by $30 billion by Multiple Choice   decreasing taxes by $20 billion.   increasing government spending by $20 billion.   increasing government spending by $18 billion.   decreasing taxes by $30 billion.

income taxes and government spending during a recession. Automatic stabilizers increase; increase increase; decrease decrease; increase decrease; decrease

M10

Assume the tax multiplier is estimated to be 1.3 and the aggregate supply curve has its usual upward slope. Suppose the government lowers taxes by $75 million. Aggregate demand will by $ million. (Enter your response rounded to one decimal place.)

Question 1 There is a recession gap of $150 billion in the economy. The MPS is 20%. What is the MPC [Select] and the Government Spending Multiplier [Select] Government need to [Select] much [Select] change taxes, would they [Select] the Tax multiplier [Select] [Select] ? Would the spending? By how ? If the Government decided to taxes? What is and by how much

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.

Which of the following is an example of an action where crowding-out could occur? A decrease in government housing subsidies causes an increase in private spending on housing. The government lowers taxes, but spending does not increase. The government increases spending but does not increase taxes, and the size of the budget deficit increases. The government invests in education, shifting the long-run aggregate supply curve to the right. The government pays $2 million to workers who have lost their jobs in the form of unemployment compensation.

Key limitations to fiscal policies.

Suppose the economy is in a recession. In this case automatic stabilizers will  Group of answer choices cause the government's budget to move toward a surplus. cause the government's budget to move toward a deficit. not cause the government's budget to move in any particular direction. cause the government's budget to move toward a balanced budget.

Q1. Suppose MPC is 0.8. If government purchases increases by $10c and cuts taxes by $503, how much the equilibrium output is changed? a=6 and B=5