Which of the following economic schools of thought promote the use of fiscal policies to stimulate spending during periods of recession *       Monetarists       Keynesians       Classical       Supply-side economics

Q: The various kinds of automatic stabilizers are: Group of answer choices Expansionary Monetary Policy…

A: Automatic stabilizers are designed in such a manner that they automatically change as per the…

Q: In a closed economy, is the fiscal policy effective when the demand for money is interest rate…

A: A closed economy is defined as a country that is self sufficient and autarkic. A closed economy is…

Q: Automatic stabilizers:     A)  counteract both recessions and expansions through changes in…

A: Automatic stabilizers are part of the government budget that offsets fluctuations in aggregate…

Q: Suppose the economy currently has an inflationary gap. The Federal Government engages in…

A: Contractionary fiscal policy has two important tools that are reducing money supply and increasing…

Q: please answer the following question: 1. Automatic stabilizers: A) work without the need for…

A: A boom illustrates a phase of elevated or rised growth within a business, market, industry, or…

Q: As discussed in the class, discretionary policies are the actions the administration takes in order…

A: The macroeconomic policies that are formulated in the wake of the changes in the economy, by the…

Q: Expansionary fiscal policy occurs when the government decreases spending or increases taxes to…

A: Fiscal policy is the tool used by government to control the economy.

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

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Fiscal policy to solve short-run economic problems supports the Keynesian notion of    A. there…

A: The use of government spending and tax policies to influence economic conditions, especially…

Q: If the marginal propensity to consume is 0.2 and the government increases its spending by ¥1…

A: Marginal propensity to consume is 0.2 => MPC = 0.2 ----------------- Spending multiplier = 1 / (1…

Q: According to Classical economists, which type of fiscal policy financing produces "crowding out? a.…

A: Fiscal policy implies the use of government expenditure or tax revenue in order to change the…

Q: Which of the following is an example of an automatic stabilizer? When the economy goes into a…

A: The automatic stabilizer is changing in the fiscal policy that helps to stimulate the aggregate…

Q: Give a numerical example and illustrate the difference between complete crowding out, incomplete…

A: Answer - Thank you for submitting the questions but, we are authorized to solve one question at a…

Q: Fiscal policy of increasing government expenditures can be more potent than monetary policy in…

A: Fiscal policy works through changes in government expenditures and changes in taxes, while monetary…

Q: According to the supply side fiscal policy, increasing tax rates on wages will: Group of answer…

A: When there is increase in wages, there is increase in cost of production.

Q: According to the classical macroeconomic model, expansionary fiscal policy has an inflationary…

A: Fiscal Policy is a policy by which the governments adjusts its amount of expenditure and taxes…

Q: How do (a) Income tax during inflation, (b) Unemployment benefits and other transfer payments during…

A: Automatic Stabilizer:-  Automatic stabilizers are long-term governmental programmes that modify…

Q: ompare monetarist and Keynesian views on the proper conduct of FISCAL POLICY. For both monetarists…

A: The aggregate demand curve shows the inverse relationship between the price level and total quantity…

Q: 3. Automatic stabilizers: Group of answer choices work without the need for decisions from Congress…

A: An automatic stabilizer implies the market forces that act automatically in the market to correct…

Q: Fiscal Policy is determined by The Federal Reserve All States Determine Their Own Fiscal Policy The…

A: Fiscal Policy: - the economic policies related to the government taxes and government expenditure…

Q: Which of the following is an appropriate fiscal policy response if the economy is in a state of…

A: The fiscal policy is the policy of the government in the economy to control the spending levels of…

Q: According to the traditional Keynesian analysis, if the government increases spending and pays for…

A: A government budget deficit occurs when government spending is greater than government tax revenue.…

Q: According to Classical economists, which type of fiscal policy financing produces "crowding out? a.…

A: Crowding out refers to the procedure where increases in government spending decreases other…

Q: (Fiscal Policy) Define fiscal policy. Determine whether each of the following, other factors held…

A: Answer- Fiscal Policy - This is a policy which a government adjusts its spending levels and tax…

Q: Suppose that the government provides each taxpayer with a $1,000 tax rebate financed by issuing…

A:

Q: fiscal policy is most effective when combating recessions caused by demand shocks recessions caused…

A: The use of government spending and tax policies to influence economic conditions, especially…

Q: Explain the impact of a tax cut on income, the interest rate and money demand in the IS-LM model.…

A: Fiscal policy is the process through which a government adjusts its tax rates and levels in order to…

Q: sume an economy where the government embarks on an expansionary fiscal polcy, explain the effect on…

A: Fiscal policies are those that change government spending and tax policies in order to regulate…

Q: Which of the following statements is FALSE?   A. An expansionary fiscal policy might consist of an…

A: Discretionary fiscal policy is a policy in which the government made changes in its spending and/or…

Q: Which of the following statements is true? Unlike monetary policy, fiscal policy is not subject to…

A: Policy: It refers to the plans and programs made for the growth of the economy. The policies are…

Q: Exhibit 24-1 shows the short run and long run equilibrium in an aggregate demand-aggregate supply…

A: Equilibrium real GDP is produced at the intersection of aggregate demand and aggregate supply…

Q: Assume an economy where the government embarks on an expansionary fiscal policy, explain the effect…

A: Fiscal and Monetary policies are used to tackle the macroeconomics conditions like aggregate demand,…

Q: Contractionary fiscal policy is designed to combat demand-pull inflation and consists of a decrease…

A: Contractionary fiscal policy is implemented to reduce the inflationary gap. This gap is usually…

Q: If households and firms are pessimistic about the economy and very reluctant to increase investment…

A: When the zero interest rate policy does not make economy to move out of recession, the expansionary…

Q: Explain by means of aggregate demand equation and IS-LM model graphs the concept behind Fiscal…

A: The policy makers are the decision making authorities, which makes decisions regarding which…

Q: Identify each scenario as an example of expansionary fiscal policy, contractionary fiscal policy, or…

A: In order to influence and manage the nation's economy, the government adjusts its spending and…

Q: Automatic stabilizers     (a) Are government policies or programs that stabilize the economy…

A: Fiscal policy refers to policy of expenditure and taxes of government. Government makes changes in…

Q: Which statement below is true of ONLY fiscal policy? Uses government expenditures to create demand…

A: The fiscal policy is the policy of the central government regarding the taxation and the government…

Q: Which statement below is true of ONLY fiscal policy? Uses government expenditures to create demand…

A: The government uses two types of macroeconomics policy which are fiscal and monetary policy. The…

Q: The economy is currently at a level of output that exceeds potential GDP (Yp).  List two fiscal…

A: Potential output is also called the natural GDP which says the maximum level of real GDP that an…

Q: Counter-cyclical fiscal policy and monetary policy is meant to     increase long-run trend GDP…

A: Countercyclical fiscal and monetary policy is the one which tries to change the direction of the…

Q: What is one of the net effects of expansionary fiscal policy according to the Neoclassical view?…

A: The answer is - d. Increase of money supply

Q: Explain the role of supply-side policies in the macro-economy. In the context of your analysis…

A: Supply side policies are the policies which lead to increased growth by increasing the aggregate…

Q: Which of the following is NOT an undesirable side-effect of discretionary fiscal policy?      A)…

A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…