1) ________ imply/implies that, holding the present value of government spending constant, budget deficits will not crowd out investment. a. Ricardian equivalence b. Lower taxes c. Crowding in d. Lower interest rates

Q: 1)Which of the following best characterizes what a recessionary environment requires of a government…

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

Q: 70 460 480 500 520 540 560 580 600 Real GDP a. If potential GDP (LAS) IS $580, and the economy is…

A: Recessionary gap exits when the aggregate expenditure is less than the real output at full…

Q: 1. If the marginal propensity to consume is 0.8 in an economy, a $20 billion rise in Incomes will do…

A: Multiplier = 1 / (1 - MPC) = 1 / (1 - 0.8) = 1 / 0.2 = 5 It means that, if income increases by $1 ,…

Q: Which of the situations is an example of the crowding-out effect on investment as it pertains to…

A: Crowding out is a situation where the government increases the borrowings to such an extent that the…

Q: True/False 1) Unemploymen benefits are an example of fiscal policy.2) According to Ricardian…

A: A transfer payment is a redistribution of income facilitated by the government of an economy as it…

Q: 7) If investment falls a lot when the interest rate rises, there will be A) a steeper investment…

A: An item or an asset that is being acquired with the sole goal of appreciation of the asset or…

Q: 3. Specify whether expansionary or contractionary fiscal policy would seem to be most appropriate in…

A:

Q: Explain 2 alternative methods that you can think of to raise government finance other than borrowing…

A: Government expenditure is the amount that the country's government spends for the development of the…

Q: 7. Non-discretionary fiscal policy designed to counteract a reduction in aggregate demand might…

A: A non-discretionary fiscal policy refers to the government action or policy thay acts to deal with…

Q: 100 80 60 40 20 O $100 200 300 400 500 600 700 800 900 GDP Refer to the diagram, in which Tis tax…

A: When spending surpass receipts, a budget deficit occurs, and it indicates a country's financial…

Q: a) Define what are  expansionary and contractionary discretionary fiscal policies.

A: Hey, Thank you for the question. According to our policy, we can only answer 1 question per session.…

Q: 3.1 How does expansionary monetary policy increase spending in the economy compared to how…

A: Expansionary Monetary Policy is used by Fed to increase the supply of money in the economy.…

Q: Show and explain how an expansionary fiscal policy can cause crowding-out effect by using aggregate…

A: Since there are multiple questions posted, we will answer only to the first one.

Q: Homework - Please give explaination for correct option. The US national debt is approximately $23.2…

A: Given:P=$23,200 billionr=4%=0.04n=40 years (2059-2019)

Q: 4. Why are fiscal policy multipliers smaller in magnitude in the variable price-fixed wage version…

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

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: If the South African government can fund its deficits without the economy experiencing rising…

A: Unbalanced budget exists in an economy if its revenue collected from taxes and expenditure done by…

Q: 2. The U.S. economy is in recession and has a large recessionary gap. Describe what automatic fiscal…

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

Q: 6) If the inflation rate is 3 percent, real GDP growth is 2 percent, and the current budget deficit…

A: Given: Inflation rate=3% Real GDP growth rate=2% Current budget deficit=$100 billion

Q: 10.We discussed four problems (Problems of Timing, Political Consideration, Offsetting State and…

A: The four problems of fiscal policies are listed as below. Problems of TimingPolitical…

Q: A serious problem with fiscal policy is that a. All countries borrow heavily from foreigners, which…

A: Fiscal policy is the action of the ruling party or government of a nation to influence the economic…

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

A: The fiscal policy refers to a policy which is used to influence the aggregate demand in the economy.…

Q: Critical thinking question Does an active fiscal policy help or hinder long-run growth in the…

A: a. Fiscal policy helps in achieving the following growth parameters of an economy.

Q: Which one of the following statements is TRUE about the concept of crowding out? Select one: a.…

A: Fiscal policy refers to the set of measures adopted by the government of an economy to correct…

Q: Explain how a larger government budget deficit increase the magnitude of the crowding-out effect?

A: government budget deficit  means that government's expenditure is more than the government's revenue…

Q: government expenditure towards infrastructure increases and is deficit financed, then: a. The debt…

A: Government spending or use incorporates all government utilization, investments, and transfer…

Q: 1) According to the tax smoothing theory, countries anticipating strain due to an aging population…

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

Q: 1. Suppose IS curve is Y = 4500-100i and Y = 2000+250i is the LM curve. a) Compute i and Y. Compute…

A: IS: Y = 4500 - 100i Y + 100i = 4500 LM: Y= 2000 + 250i Y - 250i =2000

Q: 7. An expansionary fiscal policy: (Select All that Apply) A. usually decreases a government budget…

A: As there are multiple different questions, solution is provided to the first question i.e. Q7.…

Q: If the budget deficit is lower than it was last year, we could say that      A) the general…

A: In an economy, budget deficit refers to a situation when government spending is higher than its…