If the unemployment rate in the economy has increased from 8% to 9% in the last six months, the appropriate use of fiscal policy would be: O To raise taxes and increase government spending. O To raise interest rates and decrease government spending. O To raise taxes. O To lower taxes.
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- Under what general macroeconomic circumstances might a government use expansionary fiscal policy? When might it use contractionary fiscal policy?During the Great Recession of 20082009, what actions would have been required of Congress and the President had a balanced budget amendment to the Constitution been ratified? What impact would that have had on the unemployment rate?What are some of the ways fiscal policy might encourage economic growth?
- What is fiscal imbalance? Fiscal imbalance is the _______ value of the government's commitments to pay benefits minus the _______ value of its tax revenues. A. future; future B. future; present C. present; future D. present; presentWhich of the following is NOT a tool of fiscal policy. O taxes O government spending Onterest rates none of the above Question 2 Assume the economy is in a deep recession. The appropriate fiscal policy response would be to: raise taxes and raise govemment expenditures cut taxes and cut govermment expenditures raise taxes and cut government expenditures O cut taxes and increase government expenditures D Question 3 Crowding out refers to the fact that: Tax cuts will cause inflation O Tax cuts may result in higher interest rates which will "crowd out" business investment spending O increased government spending will crowd out spending on imports none of the aboveEXPANSIONARY FISCAL POLICY 20% GOVERNMENT SPENDING 80% TAKATION Gvemme Spnding Taationmater than pter than tation apud How will Expansionary Fiscal Policy affect the Federal Budget? A budget surplus will decrease the national debt Deficit spending will decrease the national debt Deficit spending will increase the national debt A budget surplus will increase the national debt
- The graph below shows real GDP levels over time. Answer the following questions based on this groph. Real GDP T Business Cycle Time Y" a. At time T. what is the economy experiencing? O full-employment output an economic expansion an economic contraction b. In order to smooth out the business cycle, what type of fiscal policy should the government undertake? contractionary fiscal policy expansionary fiscal policy c. What type of actions might the government take? a decrease in taxes and an increase in government purchases a decrease in both taxes and govemment purchases an increase in taxes and a decrease in government purchases an increase in both taxes and government purchasesExpansionary fiscal policy include Select one: O a. an increase in net taxes O b. an increase in government spending O c. a decrease in government spending1. Recommend fiscal policy that is most likely to be invoked during a period of recession or high unemployment and during a period of rapid inflation 2. Identify problems or limitations from the implementation of fiscal policies and putting them into effect? # please answer sub questions.
- Which is a good fiscal policy when inflation is very low and unemployment is very high? Decrease the money supply O Increase government purchases of goods and services Cut government transfer payments Decrease the budget deficitWhich organisation controls fiscal policy in Australia? Select one: a. The Reserve Bank of Australia O b. The National Cabinet O. The State Governments O d. The Federal Reserve e. The Federal GovernmentWhich of the following is an example of fiscal policy? O a Controlling money supply Ob More than one of the choices is an example for fiscal policy. C. Changing reserve requirements. Consumer spending O . Tax increase. Of. Changing the prime rate