Critics of discretionary fiscal policy argue that discretionary policy : 1) has uncertain effects 2) has an impact lag that is too short. 3) raises more inflation than policy rules. 4) has long recognition and implementation lags
Select the correct option and explain why it is correct :
a) Critics of discretionary fiscal policy argue that discretionary policy :
1) has uncertain effects
2) has an impact lag that is too short.
3) raises more inflation than policy rules.
4) has long recognition and implementation lags.
b) The largest share of expenditures by state and local governemtnn is for :
1) Transfer payment
2) national defense
3) law enforcement
4) purchase of goods and services
c) Countercyclical fiscal policy is designed to :
1) shift the inflation adjustment line so that real GDP is equal to potential GDP
2) reduce
3) increase potential GDP
4) shift the aggregate demand curve so that real GDP equals potential GDP.
d) Which of the following types of taxes provide the most revenue for the federal governemtn
1) Payroll taxes
2) income taxes
3) Sales taxes
4) corporate taxes
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