In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals. Raising taxes by the US government is an tool of Monetary policy Fiscal policy Accommodation policy Interest rate policy
Q: they must be willing to accept a higher rate of unemployment.
A: Explanation: A contractionary policy refers to the government or financial organization's actions…
Q: One of the three main tools of the Federal Reserve is fiscal policy. True False
A: Central Bank: The central bank is the apex bank of the country that supplies the money or maintains…
Q: The political business cycle refers to The ups and downs in the overall business activity of…
A: Political economy is a discipline of social science that studies the interactions between people,…
Q: Which of the following is a false statement?
A: An expansion/ boom can be stabilized/fixed by following expansionary fiscal policy. TRUE…
Q: An intended goal of expansionary fiscal policy and an easing of monetary policy is Select one: a.…
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Q: As a result of an economic policy change, interest rates and consumption rise but investment falls.…
A: Fiscal and monetary policies are two main tools to correct the economic imbalances . Where expansion…
Q: Differentiate between the following terms. Expansionary fiscal policy and expansionary monetary…
A: Expansionary fiscal policy is the policy which focuses on increasing aggregate demand by increasing…
Q: The Board of Governors: Question 6 options: are appointed by the U.S. president and confirmed…
A: The Federal Reserve is the central bank of the United States of America. It operates under a…
Q: When a central bank uses its powers over the banking system to engage in “against the business…
A: Monetary Policy refers to a policy that influences the economy by manipulating the banking system's…
Q: In the short run, a rise in the federal funds rate ________ the price level and ________ real GDP.…
A: In the short run when the federal funds rate increase so investment falls and so does output and…
Q: Fiscal Policy instruments include: a) quantitative easing b) money supply manipulation c)…
A: Fiscal policy is such a policy which is framed by the government that account for government…
Q: Suppose the Central Bank of Bothnia buys Treasury Bonds. What will be the impact on the price level…
A: The fiscal and monetary policies are used by the government to achieve certain economic goals. The…
Q: In 2021 President Biden proposed raising long term capital gains taxes for wealthy individuals.…
A: Fiscal approach is generally founded on the thoughts of British market analyst John Maynard Keynes…
Q: QUESTION 3 Tools used by the central bank to control the quantity of money is called Fiscal Policy.…
A: Policies refer to the action plans undertaken by the central bank and the government of the nation…
Q: What is the Difference between Monetary & Fiscal Policy Fiscal Policy Monetary Policy Who? Who?…
A: Who?Fiscal policy decisions are made by congress and the presidentStatement 6th Monetary policy…
Q: If the government decides to raise taxes to prevent inflation, this is an example of a) monetary…
A: Inflation can be combated by decreasing the aggregate demand.
Q: Which of the following is an example of monetary policy? The government cuts taxes Defense spending…
A: In the event of a recession, the government uses an expansionary monetary policy to increase the…
Q: In the monetary perspective: -Discretionary monetary policy is the most effective way to moderate…
A: Monetary policy: The monetary policy is adopted by the central bank to endure the price stability…
Q: A monetary policy that successfully offsets a recession also has the effect of lower output than if…
A: Monetary Policy is the policy through which quantity of the money of the economy is controlled,…
Q: Governments are responsible for maintaining full employment, price stability, and economic growth –…
A: Stimulative monetary policy of united states is the monetary policy in which policy is adjusted…
Q: To fix a negative supply shock in an economy, ___________should be used. a. contractionary…
A: The economies around the globe are focused on maximizing the level of their growth, and development.…
Q: _________________ formulates fiscal policy and _______________ formulates monetary policy (what…
A: Fiscal policies refers to policies formulated by the government which influence an economy through…
Q: Describe the fiscal stimulus packages and monetary policy interventions initiated by policymakers in…
A: The main aim of the fiscal stimulus package is to boost economic growth by creating employment…
Q: Explain each of these statements supported by reasonable reasoning: 1. Credibility is important…
A: When product is manufactured, cost takes place along with revenue, which results into profit and…
Q: Identify the circumstances under which budget deficits can lead to inflationary monetary policy.
A: A deficit occurs when expenses exceed revenue and indicate the financial health of a rustic. the…
Q: This is a true statement about monetary and fiscal policy: The Medicare program is fiscal policy…
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Q: Fiscal policy consists of tools used by the Central Bank to control the quantity of money in the…
A: Fiscal policy is the policy in which government modifies the spending levels and taxes to control…
Q: Monetary policy is subject to longer ________ lags than fiscal policy. A. Decision and…
A: The time it takes for the government and central bank to react to an adverse macroeconomic event…
Q: 18. "Liquidity trap" was a problem of a) monetary policy of Japan and Sweden. b) fiscal policy in…
A: Liquidity trap refers to the situation when a country is facing an ineffectiveness of the policy to…
Q: The Fed is an agency of the U.S. Treasury Department that has the responsibility of collecting tax…
A: Central Bank: A central bank is the most elevated monetary organization in a financial framework…
Q: An increase in the budget deficit is the result of: choose the correct answer (a) Expansionary…
A: A budget deficit happens when government expenditure surpasses income and demonstrate the economic…
Q: Fiscal policy refers to a) the spending and taxing policies used by the government to influence the…
A: Governments' economic policy encompasses taxation, budgeting, the money supply, and interest rates,…
Q: When real GDP is greater than potential output, it is most likely that the Fed will engage in…
A: There are two types of output: 1. Real output/GDP 2. Potential output/GDP
Q: Congress Central Bank- The Federal Reserve Changes the Money Supply & Interest Rates The Federal…
A: Fiscal policies are used by the government and monetary policies are used by the central bank.
Q: Fiscal and Monetary Policies are different in that a)Only fiscal policy tools may include taxation…
A: Fiscal Policy refers to the policy where there is no central banks intervention and used by the…
Q: One of the advantages monetary policy in relation to fiscal policy is that: a. It is easier to…
A: Monetary policy : The Monetary policy of the central bank of a country is to control money supply…
Q: Match each tool with the appropriate policy decrease the reserve ratio increase taxes sell bonds…
A: Expansionary fiscal policy is to decrease tax or increase spending or both 4th and 6th statement
Q: Expansionary monetary policy is when: None of the statements are correct. The president and congress…
A: Monetary policy refers to the policy of central bank that changes the cost and availability of…
Q: Monetary and fiscal policy making that is carried out in response to a pre-set rule and does not…
A: A discretionary fiscal policy is implemented in response to a certain economic shock. But…
Q: Assume the U.S. economy is already operating above the full-employment level of GDP (i.e., above…
A: The agreement gauge across models is that the tax breaks raised genuine total national output (GDP)…
Q: econ
A: Fiscal policy is the use of tax policies and government spending in order to influence conditions of…
Q: In the short run, expansionary monetary or fiscal policy is expected to O increase; decrease.…
A: Expansionary monetary policy is implemented by the central bank to increase the money supply via…
Q: Which of the following was not one of Reagan's four major policy objectives? Reduce federal income…
A: The policies that are being characterized and are being associated commonly with the supply side of…
Q: The 'automatic mechanism' can best be described as using fiscal or monetary policies to stabilize…
A: Automatic Mechanism is also known as self correction.
Q: Classify each statement as an example of expansionary fiscal policy, contractionary fiscal policy,…
A: Fiscal Policy: Fiscal policy is part of economic policy through which the government maintains the…
Q: If the Fed overcorrects the economy during a period of decreased consumer spending...... )…
A: Recession A considerable decrease in overall economic activity in a particular area is referred to…
Q: Country Y is experiencing severe and unanticipated inflation. Identify one fiscal policy action…
A: Fiscal policy is related to making modifications in expenditure and tax size with a view or motive…
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- Directions: Read the following excerpts. Identify whether the policy action is fiscal or monetary and expansionary or contractionary. Draw and label the change that would occur on the ADAS graph as a result of the policy action described in each. Identify what will happen as a result of the policy to the price level, employment, and real GDP. Excerpt from Public Law 111-5 of the 111th Congress: Signed into law by President Obama February 17, 2009 “Making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. TITLE XII—Transportation, Housing and Urban Development, and Related Agencies …projects eligible for funding provided under this heading shall include, but not be limited to, highway or bridge projects eligible under title 23, United…Please match each description with the appropriate approach to federal finance. Policymakers should reduce spending and increase taxes when the economy is growingin order to prevent "overheating". This approach was considered conventional wisdom until the advent of theGreat Depression. Policymakers should focus on keeping unemployment low and providing the peoplewith the public goods and services they want. If insisted upon, this approach would only worsen the economy during a recession. This approach ignores the impact of the budget on the business cycle.The country of Safrica has a progressive tax system and pays unemployment benefits through an Unemployment Insurance Fund. Would these be classified as fiscal or monetary policy interventions and if so what type? Also describe 3 potential problems associated with these type of interventions. Use bullet points.
- Using a four-sector economic analysis tool, present the answer separately about the relevance and impact of each of the following macroeconomic policies: (a) PAKTO ‘88(Easy / Expansionary Money Policy); (b) Increased Real Sector (Expansionary Fiscal)Policy)1. Optimal fiscal policy relies on the (a) Friedman rule (b) Laffer curve (c) model's productivity shocks (d) Federal Reserve Bank 2. In the short-run, money (a) does not enter into the representative consumer's utility function. (b) is non-neutral (because prices are rigid/sticky, often for long periods of time). (c) is the equivalent of holding a "riskless asset." (d) is used as a proxy for the pricing kernel in the sequential Lagrangian analysis.Suppose that the government decreases spending more than is necessary to close an inflationary gap. What is the MOST likely result? Inflation will increase. The price level will increase. Aggregate output will fall short of potential output. Aggregate output will increase.
- 18. Keynesian Economics: a. supports the theory that deficit spending can be used to stimulate the economy during economic downturn b. support the theory that government should not interfere with the free market c. supports the theory that public perception drives economic conditions d. supports the theory that government shpuld completely control the economySince the committee's meeting labor market conditions deteriorated and the available data indicate that consumer spending, business investment and industrial production have declined. Finiacial markets remain quite strained and credit conditions tight. identify the policy action is fiscal or monetary identify the policy is expansionary or contraction artA government is evaluating the effectiveness of a new tax policy. Economists collect data on tax rates, government revenue, and economic growth before and after the policy implementation. They use econometric methods to assess the policy's impact on economic indicators. This application of econometrics primarily serves to:A) Estimate policy impactB) Create new tax lawsC) Design government websitesD) Recruit government staff Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism.Answer completely and accurate answer.Rest assured, you will receive an upvote if the answer is accurate
- By decreasing government spending and aggregate demand, the policy ________ the price level and ________ equilibrium real GDP, ceteris paribus. Select one: a. decreases; increases b. increases; decreases c. increases; increases d. decreases; decreasesWhich of the following statements about Fiscal Policy is INCORRECT? choose the correct answer(a) In order to combat inflation, the South African Reserve Bank must apply acontractionary fiscal policy;(b) A contractionary fiscal policy can result in higher levels of unemployment; (c) Expansionary fiscal policy will increase the budget deficit; (d) The application of fiscal policy will have no effect on aggregate supply in theAD‐AS modelPlease match each description with the appropriate approach to federal finance. Policymakers should reduce spending and increase taxes when the economy is growingin order to prevent "overheating".This approach was considered conventional wisdom until the advent of theGreat Depression.Policymakers should focus on keeping unemployment low and providing the peoplewith the public goods and services they want.If insisted upon, this approach would only worsen the economy during a recession.This approach ignores the impact of the budget on the business cycle. Answer bank in image
