What is a fiscal policy tool used to stimulate economic growth during a recession? A. Increasing government spending B. Reducing taxes C. Selling government bonds D. Reducing government spending
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- Explain why the government might prefer to provide incentives to private firms to do investment or research and development, rather than simply doing the spending itself?Answer the question completely: 1. How can fiscal policy promote economic growth and development?What are some of the ways fiscal policy might encourage economic growth?
- How much more output does the $20 trillion U.S economy produce when GDP increases by 1.0 percent?Considering the impact of fiscal policy on economic growth, how might a progressive federal tax system influence income distribution and overall consumer spending behavior?Which system of taxes is best? Why does that system is the most effective way for the government to generate revenue and maintain our economy's growth?
- Discuss the federal budget of the U.S government. should it always be balanced? when is the most appropriate time economically speaking for the federal budget be in a deficit? as a borrower how is the federal government different from the average U.S adult?a) Why can't the government run a budget deficit in a one- period macroeconomic model? b) Why are government transfer payments not included in (expenditure-based) GDP?Do tax cuts increase economic growth and taxable income so much that tax revenue increases?
- Suppose there is an increase in budget deficit, what happens to intrest rates and national savings ?If tax cuts don't cause enough economic growth, we might also need to reduce expenditures to reduce the deficit. Explain?The following transactions took place in Ecoland in 2018: Trillions of 2014 dollars Government purchases 400 Taxes 360 Firms’ profits 300 Investment 400 Consumption expenditure 1000 Wages paid to labor 1400 Exports 300 Government transfer payments 150 Imports 350 (a). Calculate Ecoland’s real GDP in 2018, i.e., GDP measured in 2014 $. (b) How much do households save in Ecoland? Is it enough to finance domestic investment? (c) Does the government have a balanced budget? If not, what is the surplus or deficit? (d) If Ecoland’s nominal GDP in 2018 is $1900 trillion, how much inflation has Ecoland experienced since 2014?