The higher the interest sensitivity of investment the   a. less effective are both monetary and fiscal policies. b. less effective is monetary policy and the more effective is fiscal policy. c. less effective is fiscal policy and the more effective is monetary policy. d. more effective are both monetary and fiscal policies.

Q: Fiscal policy is conducted by the government and aims at boosting the economy; which of the…

A: The economies around the world have various entities, which are considered to be decision makers,…

Q: When the economy is going through recessionary gap, which of the below policy is more likely to be…

A: Aggregate Demand curve (AD) is the downward sloping curve which shows an inverse relationship…

Q: Which fiscal policy is meant to decrease aggregate demand? a. Divisionary b. Built in c.…

A: Fiscal Policy is the changes made in the economic conditions by the change in government spending or…

Q: Other things being equal, a decrease in the money supply will: A. decrease both investment spending…

A: Money supply is defined as the amount of money that is available with public for the purpose of…

Q: Assume the economy is at an output level that is above the potential GDP, if a contrary fiscal…

A: Fiscal Policy refers to changes in the government expenditure or tax rates in order to bring the…

Q: The multiplier is ?   a. the ratio of government debt to income b. the ratio of an increase in…

A: c. the ratio of the total increase in GDP to an initial increase in exogenous spending.Explanation:…

Q: If the economy is at point E, what policy should be implemented, contractionary or expansionary?…

A: Fiscal policy involves changes in government spending and tax rates. Changes in the fiscal policy…

Q: What is an example of federal investment? a. Federal reserve monetary policy, specifically selling…

A: Federal investment  It's the fraction of federal spending that is designed to provide long term…

Q: Suppose an economy is above full employment. A policy to slow the economy's growth rate might A.…

A: Full employment level refers to a situation in an economy where the labor market is in a state of…

Q: Which of the following fiscal policy actions would be appropriate if the economy is experiencing an…

A: Fiscal policy is a macroeconomic policy tool that governments utilize to impact an economy's overall…

Q: Answer True or False: 1. To reduce the fiscal deficit, the government has to raise taxes or cut…

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

Q: Assume that country has a MPS of 0.2. Calculate the maximum change in Real GDP as a result of the…

A: The real GDP is the actual productivity that is endured by the economy. In this case, the inflation…

Q: SRAS PL2 PL AD2 AD Y,Y2 REAL GDP The Aggregate Demand Model shows an increase in Aggregate Demand or…

A: The given figure shows the increase in aggregate demand. Prices and output are increased.

Q: Finance Minister Enoch Godongwana announced during his budget speech that South Africans can receive…

A: Fiscal policy is the use of government revenue and spending measures to influence the overall…

Q: A. Identify if the problem is inflation or unemployment. If unemployment, state which type of…

A: Inflation is defined as a situation under which there is a persistent increase in the prices of…

Q: In the long run, the government budget will add to sustained inflation if. Oa Deficits are always…

A: Answer: b In the long run, the government will add to sustained inflation if continual deficits are…

Q: Consider that in 2017, the government decides to increase government spending to $1000 million.…

A: A governme­nt's taxing and spending practices are calle­d fiscal policy. It impacts the economy.…

Q: One way that the government can increase aggregate demand is by: A. reducing income taxes. B.…

A: Some typical ways economic policy is employed to extend aggregate demand include tax cuts, military…

Q: Fiscal Policy: End of Chapter Problem   Examine what the "three difficulties with using fiscal…

A: Answer - "Thank you for submitting the question. But, we are authorized to solve only 3 subparts .…

Q: 12. What is the purpose of the following fiscal policies? a. Contractionary b. Expansionary fiscal…

A: In economics and political science, fiscal policy is the use of government revenue collection and…

Q: A tax cut shifts aggregate demand A. by less than the tax cut. B. by the same amount as the tax…

A: (Q) A tax cut shifts the aggregate demand A. by less than the tax cut. B. by the same amount as…

Q: An example of a fiscal policy designed to increase real GDP is a. a cut in taxes. b. an increase in…

A: Fiscal policies are designed to influence the aggregate demand, which further leads to affect the…

Q: Crowding out will be greater   A. the more sensitive investment spending is to changes in the…

A: GDP is the gross domestic product which is the value of newly produced goods and services in a…

Q: Pls help with below homework, explain the correct answer throughly.

A: Meaning of Closed Economy: The term closed economy refers to the situation under which there…

Q: Which of the following would most likely occur if the federal government decreased its spending and…

A: During a period of full employment, the economy is operating at or near its maximum potential…

Q: 1.Which of the following is an example of fiscal policy? Select an answer and submit. For keyboard…

A: Fiscal policy refers to the policy used by the government to stabize the economy.

Q: 2. Give three examples of governments whose use of fiscal policy leaves a lot to be desired? Explain…

A: GDP is the total value of all goods and services produced within a country's borders over a specific…

Q: hich of the following statements regarding a Laffer curve is the most plausible? Reducing a high tax…

A: Economics and Policy:Once a country has basic things such as the rule of law and safety, the most…

Q: Fiscal policy is the use of government tax and expenditure policy to influence the economy O True O…

A: Fiscal policy is used by government to influence aggregate demand and real GDP in the economy.

Q: Tax cuts shift aggregate demand

A: The expenditure of the government described as money that is spent by the government or public…

Q: What would have a larger effect on aggregate demand: $150 billion of tax cuts or $150 billion of…

A: Government expenditure is the amount of money spent by the government on welfare projects and for…

Q: eal government purchases may fall when the price level rises if which of the following is true?…

A: Quantitative Easing (QE):Quantitative Easing is a monetary policy tool used by central banks to…

Q: Reductions in the personal income tax, often advocated by supply-siders to increase labor supply and…

A: This is an application of the labour-leisure choice problem. Here the consumer chooses the amount of…

Q: 18. Keynesian Economics: a. supports the theory that deficit spending can be used to stimulate the…

A: 18. Keynesian Economics is a macroeconomic theory, which is advocated that the government deficit…

Q: 31. If taxes and regulations are a major cost of business, model how would you model a reduction in…

A: If there are tax cuts and a reduction in regulations, it shifts the aggregate demand curve…

Q: C MPA a MPB ISB ISA the Fed will To prevent a Consider figure, if there is a sharp increase in…

A: A sharp increase in consumer confidence implies that consumers will spend more than before. If…

Q: In AD/AS analysis, fiscal policy affects the economy through: OA. Both the AS and AD curves. OB. The…

A: The economy's output is not always at the potential level in the short run causing some adverse…

Q: Along any given IS curve: a. government spending is fixed, but tax rates vary. b. tax rates are…

A: IS-LM stands for "investment savings-liquidity preference-money supply," or "investment…

Q: Using a change in taxes to improve the economy during a recession a. tends to benefit low-income…

A: Since you have posted two independent McQs, according to the guidelines, only the first McQ is…

Q: Type your answers in all of the blanks and submit X₂ X Ω· The following figure shows an economy.…

A: Gross domestic product is the final combination of goods and services in a country. GDP is an…