uncle sam's toolbox

1. Give three examples of governments that are adept in the use of fiscal policy. 2. Give three examples of governments whose use of fiscal policy leaves a lot to be desired? Explain your thinking. 3. What is potential GDP? What role does it play in fiscal and monetary policies?

44)Which of the following statements is most accurate regarding fiscal policy and monetary policy? Select one: a. Monetary policy can be changed more quickly than fiscal policy. Fiscal policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change fiscal policy. b. Fiscal policy can be changed more quickly than monetary policy. Fiscal policy has much shorter delays due to the smaller number of legislators involved. c. Monetary policy can be changed more quickly than fiscal policy. Monetary policy can be changed at any of the FOMC meetings and the smaller number of individuals involved makes it easier to change monetary policy. d. Fiscal policy can be changed more quickly than monetary policy. Monetary policy has much longer delays due to the larger number of legislators involved.

1. Increasing government spending when the economy is in a recession is an example of:   A. active monetary policy   B. active fiscal policy   C. passive monetary policy   D. passive fiscal policy 2. Because monetary and fiscal lags are long and variable:   A. stronger policies must be used   B. successful stabilization policy is completely impossible   C. attempts to stabilize the economy are often destabilizing   D. policy must be completely passive

1. Which of the following best describes a fiscal policy tool? A. government spending B. bank lending C. financial capital markets D. household spending 2. Scarcity implies that: A. consumers would be willing to purchase the same quantity of a good at a higher price. B. it is impossible to completely fulfill the unlimited human desire for goods and services with the limited resources available. C. at the current market price, consumers are willing to purchase more of a good than suppliers are willing to produce. D. consumers are too poor to afford the goods and services available. 3. The difference between nominal GDP and real GDP is: A. nominal GDP measures actual productivity B. nominal GDP adjusts for inflation C. real GDP adjusts for inflation D. real GDP excludes imports and exports 4. Macroeconomics primarily examines: A. the behavior of individual households and firms. B. how prices are determined within individual markets. C. broad issues such as national output, employment and…

1. Suppose the economy has fallen into a recession (output level ?0), and the federal government wants to return the economy to its original level of output (?). Respond to each of the following questions using appropriate diagrams and explanations.(a) If policy makers can only use fiscal tools, what should they do?(b) If policy makers can only use monetary tools, what should they do? (c) What should they do if they want to return output to its original level but keep investment from changing?

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Budget deficit is defined as the difference between government spending and tax revenues. As President Clinton once stated, dealing with the budget deficit is simple "arithmetic". We need to cut government spending and increase tax revenues to lower the deficit. 1. If you are one of the policy makers determined to control the federal budget, which federal spending item(s) would you cut? 2. How would you change the tax policy to increase the tax revenue? Would you increase the income tax rate or decrease it to increase revenue (review the Laffer curve and comment on the relationship between the tax rate and and tax revenue)? How would you change the payroll tax? Who should have the burden of tax? Please review the 2018 Trump tax law and Biden administrations tax proposals. Below are two short videos: One supports the tax cuts, the other opposes. Tax cuts will spark growth and employment (Laffer) Six things we'll regret about Trump tax cuts 3. What is the impact of Covid-19 on the budget…

14) The relationship between monetary policy and the time it takes for policy to change spending is an example of the benefits of "leaning against the wind" why fiscal policy is preferable because it does not suffer from lags. the condition that monetary policy affects the economy almost immediately the problem that monetary policy affects aggregate demand primarily by changing interest rates but it takes time for changes in interest rates to alter spending.

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73. During the economic downturn of the 1970s, lenders to Latin American countries raised interest rates. This caused Latin American debt to balloon, and these countries were unable to pay their debts. This is an example of: Group of answer choices a. the interaction between monetary policy and fiscal policy. b. an automatic stabilizer. c. crowding out. d. a debt crisis.

1. Which of the following is NOT a category of fiscal policy?   Group of answer choices government policies regarding taxation government policies regarding money supply in the economy government policies regarding transfer payments and welfare benefits government policies regarding the purchase of goods and services       2. Disposable income   Group of answer choices increases when net taxes increase. increases when saving decreases. decreases when saving increases. increases when income increases.

Can you help me with this question? 2

6. Use of discretionary policy to stabilize the economy Should the government use monetary and fiscal policy in an effort to stabilize the economy? The following questions address the issue of how monetary and fiscal policies affect the economy, as well as the pros and cons of using these tools to combat economic fluctuations. The following graph plots hypothetical aggregate demand (AD), short-run aggregate supply (AS), and long-run aggregate supply (LRAS) curves for the U.S. economy in January 2026. Suppose the government chooses to intervene in order to return the economy to the natural level of output by using ▾ policy. Depending on which curve is affected by the government policy, shift either the AS curve or the AD curve to reflect the change that would successfully restore the natural level of output.

Fiscal Policy Worksheet Follow these steps: A. Identify if the problem is inflation or unemployment. If unemployment, state which type of unemployment. B. If it is cyclical unemployment, list the two ways fiscal policy can be used to resolve the problem. If it is some other type of unemployment, state what the government should do. C. If the problem is inflation, list the two ways fiscal policy can be used to resolve the problem. 4. Greenway high stude 5. During the last 6 months the consumer price index has increased by 10%. 7. Former phone operators are now looking for work. the country are being paid high to pay high prices for cars, C he construction workers

True or False and why? 6. Fiscal policies tend to be automatic as a result of legislation. 7. Taxes always act as automatic stabilizers. 8. Contractionary monetary policies result to lower investment spending and higher incomes. 9. Inflation targeting is a mandate exclusive to the Bangko Sentral ng Pilipinas. 10. Expansionary monetary policies result to an increase in real GDP.

Please answer all question, it's really matter. ( not very long, just short understandable answers) 1. Does the US currently rely more on fiscal policy or monetary policy to stabilize the economy? 2. Does fiscal policy have an expansionary bias? explain 3. Does fiscal policy have an expansionary bias?

Part A Decide whether each of the following fiscal policies of the federal government is expansionary or contractionary. Write expansionary or contractionary, and explain the reasons for your choice. 1. The government cuts business and personal income taxes and increases its own spending. Expansionary. The decrease in personal income taxes increases disposable income and thus increases consumption spending. The business tax cut increases investment spending, and the increase in government spending increases government demand. 2. The government increases the personal income tax , Social Security tax and corporate income tax Government spending stays the same 3. Government spending goes up while taxes remain the same. 4. The government reduces the wages of its employees while raising taxes on consumers and businesses Other government spending remains the same

3. Play the Fiscal Ship and share your recommendations for fiscal policy.  4. Share a news story related to the course.  Reflect on what you learned from your readings. Ask a critical question based on your readings. Argue with any part of the readings.

1. How did U.S. government responded to global health pandemic? What kind of steps have they taken?  How did Federal Reserve responded to the recent health pandemic? Where is the Fed Funds rate as of today? Are there any other steps that can be taken by the government in terms of fiscal policies? Please elaborate.

1. Define fiscal policy    2. Evaluate the potency of fiscal policy

35) A government reduces its budget deficit, but at the same time people become concerned that the outlook for future government expenditures and revenues increase the chance it will default. Which of the following is correct. The reduced budget deficit will raise interest rates in general. The increased risk of default will raise interest rates on government bonds. a. The reduced budget deficit will raise interest rates in general. The increased risk of default will reduce interest rates on government bonds. The reduced budget deficit will reduce interest rates in general. The increased risk of default will raise interest rates on government bonds. The reduced budget deficit will reduce interest rates in general. The increased risk of default will reduce interest rates on government bonds. b. C. d.

7. Use of discretionary policy to stabilize the economy Should the government use monetary and fiscal policy in an effort to stabilize the economy? The following questions address the issue of how monetary and fiscal policies affect the economy, as well as the pros and cons of using these tools to combat economic fluctuations. The following graph plots hypothetical aggregate demand (AD), short-run aggregate supply (AS), and long-run aggregate supply (LRAS) curves for the U.S. economy in March 2026. Suppose the government chooses to intervene in order to return the economy to the natural level of output by using Depending on which curve is affected by the government policy, shift either the AS curve or the AD curve to reflect the change that would successfully restore the natural level of output. 150 130 110 PRICE LEVEL 8 70 M 20 23 LRAS 34 24 OUTPUT (Tons of dears) AS AD 26 AD policy. AS

7. Use of discretionary policy to stabilize the economy Should the government use monetary and fiscal policy in an effort to stabilize the economy? The following questions address the issue of how monetary and fiscal policies affect the economy, as well as the pros and cons of using these tools to combat economic fluctuations. The following graph plots hypothetical aggregate demand (AD), short-run aggregate supply (AS), and long-run aggregate supply (LRAS) curves for the U.S. economy in February 2026. Suppose the government chooses to intervene in order to return the economy to the natural level of output by using Depending on which curve is affected by the government policy, shift either the AS curve or the AD curve to reflect the change that would successfully restore the natural level of output. AS 110 X AD 70 LRAS 24 26 OUTPUT (Trillions of dollars) PRICE LEVEL 150 130 50 20 22 28 30 AD policy. AS Suppose that in February 2026 the government successfully carries out the type of…

10 Within the Keynesian system explain the following: (a) the relationship between the effectiveness of monetary policy and the interest elasticity of investment. Will monetary policy be more or less effective the higher the interest elasticity of investment demand? Now explain the relationship between the effectiveness of fiscal policy and the interest elasticity of investment demand. (b) the relationship between the effectiveness of monetary policy and the interest elasticity of money demand. Will monetary policy be more or less effective the higher the interest elasticity of money demand? Now explain the relationship between fiscal policy and the interest elasticity of money demand.