20. What are the functions of the House Ways and Means Committee? a) To propose legislation that governs taxation b) To assist the president in appointing the chairman of the Federal Reserve c) To oversee anti-trust cases against government entities d) To oversee legislation that regulates the banks

20. What are the functions of the House Ways and Means Committee? a) To propose legislation that governs taxation b) To assist the president in appointing the chairman of the Federal Reserve c) To oversee anti-trust cases against government entities d) To oversee legislation that regulates the banks

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: Six Debates Over Macroeconomic Policy

Section: Chapter Questions

Problem 5CQQ

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Similar questions

How will cuts in state budget spending affect federal expansionary policy?
What are some practical weaknesses of discretionary fiscal policy?
True or False: Federal spending has grown substantially in recent decades. By world standards, the U.S. government controls a relatively large share of the U.S. economy. A majority of the federal governments revenue Is collected through personal income taxes. Education spending is slightly larger at the federal level than at the state and local level. State and local government spending has not risen much in recent decades. Defense spending is higher now than ever. The share of the economy going to federal taxes has increased substantially over time. Foreign aid is a large portion, although less than half, of federal spending. Federal deficits have been very large for the last two decades. The accumulated federal debt as a share of GDP is near an all-time high.
If the government gives a 300 tax cut to everyone in the country, explain the mechanism by which this will cause interest rates to rise.
How would a balanced budget amendment change the effect of automatic stabilizer programs?
Explain whether or not you agree with the premise of the Ricardian equivalence theory that rational people might reason: Well, a higher budget deficit (surplus) means that Im just going to owe more (less) taxes In the future to pay off all that government borrowing, so Ill start saving (spending) now. Why or why not?
One of the main arguments against using Fiscal Policy is the crowding out effect. Suppose the government uses government purchases to stimulate the economy. Explain quantitative easing? If the Fed’s current policy is quantitative easing, do you think that there is a danger of the government’s current fiscal policy being crowded out? Why or Why not? Explanation required.
32. Discuss two reasons why discretionary fiscal policy (expansionary & contractionary) may be ineffective?
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.
07. What factors make an expansionary "stimulus" fiscal policy effective? One answer a) A government budget deficit associated with fiscal stimulus should should borrow money from those who spend less and save more, to those who spend more and save less. b) A permanent decrease in taxes is more effective in stimulating spending than a temporary one c) An increase in government purchases of goods and services should be temporary and should not permanently displace private spending d) The most expansionary way of financing the budget deficit associated with a fiscal stimulus policy is by the central bank expanding the quantity of money in circulation. e) Infrastructure investment belongs with long-term growth policy, but invariably makes a poor element in stimulus policy because such investment normally take a long time to implement. f) All the above
6. Assume that the economy is facing the zero lower bound.a. Explain how the Federal Reserve might engage in expansionary monetary policy and what that will do when the economy is facing the zero lower bound.b. Explain how expansionary fiscal policy might influence the economy when facing the zero lower bound.
6. a) If US money supply in the beginning of the year is $1148 billion. Suppose the FedBank has decided to raise the reserve ration from 10 percent to 11 percent. How itwould affect the money supply? b) If tax multiplier is -2, what is the government spending multiplier? c) In order to increase equilibrium income, either the government can increasegovernment spending or may go for tax cut? What would you suggest and why?