Why do Republicans like tax cuts? Why are tax cuts a good thing? How does it affect the aggregate supply and demand graph?

Q: What is meant by fiscal policy? How far can it be used to ensure, a high level of employment?

A: In a market economy, decisions are taken by the market forces and the government has limited…

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A: Resource mobilization is the process of receiving resources from the resource provider with use of…

Q: What is the index of leading economic indicators, and how does it relate to discretionary fiscal…

A: A business cycle represents the periodic movement of the aggregate output of an economy in the…

Q: Why is a $100 billion increase in government spending on goods and services more expansionary than a…

A: According to the aggregate expenditure model Total income (Y) = Consumption (c +b(Y-Taxes) +…

Q: Why is crowding out an important issue in the debate over the use of fiscal policy?

A: Crowding out effect is an economic situation where interest rates are increased. This ends up  in…

Q: What are the implications of the current fiscal stimulus and low interest on the future of our…

A: A stimulus package is defined as a coordinated measure by the government to lift the economy out of…

Q: Explain how the conduct of fiscal policy affects consumption and investment in equilibrium.

A: Fiscal policy is a macroeconomic policy that is implemented by the government for monitoring and…

Q: Based on your understanding of the multiplier effect and the crowding-out effects, do you think that…

A: The macroeconomic equilbrium in an economy occurs at the point where the aggregate demand in the…

Q: Will a discretionary fiscal policy action that involves spending $100 billion have the same overall…

A: The discretionary fiscal policy refers to changes in the tax rate or the level of government…

Q: If the propensity to consume decreases from 95% to 80%, then Fiscal stimulus multiplier does what?…

A: Fiscal stimulus Multiplier, is also known as the Government expenditure multiplier and is given by…

Q: Why do you think that expansionary fiscal policy can fail during a recession?

A: Recession is a situation in the economy, when there is general decline in the economic activity. For…

Q: What is expansionary fiscal policy? What is contractionary fiscal policy? Does expansionary fiscal…

A: In Keynesian macroeconomic theory, aggregate demand plays a very major role in stabilizing the…

Q: What is the main advantage of automatic stabilizers over discretionary fiscal policy?

A: Fiscal policy(FP) tools can be implemented in two types that are automatic stabilizers and…

Q: What are the three fiscal policy tools and how would each be used to counter a contractionary gap?

A: Fiscal policy tools are the revenue and expenditure tools of the government undertaken to accomplish…

Q: Right now many economies in the world are experiencing a downturn due to the Corona Virus. a) What…

A: Hello, thank you for the question. Since there are multiple subpart questions posted here, only the…

Q: DYNAMIC TAX SCORING—WHAT IS IT, AND WHO WANTS IT? Go to www.google.com and search for information on…

A: Dynamic scoring is an apparatus to give individuals from Congress the data they have to assess the…

Q: Which type of discretionary fiscal policy is likely to have the smallest overall effect on GDP…

A: Discretionary fiscal policy is the government policy to control economic growth and aggregate…

Q: Why do critics charge that fiscal policy has a “big-government bias”?

A: Answer-Fiscal policy is the notion that government should actively stimulate the economy in bad…

Q: Why does a reduction in taxes have a smaller multiplier effect than an increase in government…

A: Multiplier is defined as the number which denotes a proportionate increase in income due to increase…

Q: How relevant is the multiplier concept to the implementation of expansionary and contractionary…

A: Spending multiplier: - it is a fraction that shows the magnitude of the change in national income…

Q: How fiscal policy influences aggregate demand?

A: Aggregate demand refers to the overall demand for commodities and services in an economy during a…

Q: when can we say that fiscal policy succeeded and where/ when can we say that fiscal policy has…

A: Fiscal policy refers to the actions used by governments to stabilize the economy, particularly…

Q: Who is in charge of fiscal policies, and how do their different multipliers work?

A: The fiscal policy is the use of the government budget to affect an economy. when the government…

Q: How will cuts in state budget spending affect federal expansionary policy?

A: Expansionary fiscal policy refers to an increase in the federal government purchases and or a…

Q: What is classes as an expansionary fiscal policy?

A: Fiscal policy is the government-imposed policy used to change economic conditions like demand,…

Q: What is the difference between expansionary and contractionary fiscal policy and what effects does…

A: Fiscal Policy: Fiscal policy is a part of an economic policy that is monitor by the government of…

Q: When television commentators refer to "tax and spend" policy, they are referring to O fiscal policy.…

A: A fiscal policy is a policy used by the government to stabilize the economy with taxes and…

Q: Should the government fight recessions with spending hikes rather than tax cuts ? Explain

A: Government spending and tax reductions have different multiplying effects on the economy.

Q: What are the potential issues with fiscal policy?

A: The use of govt spending and taxation policies to impact economic circumstances, particularly…

Q: What is the difference between debt and deficit? Explain why there is no time lag for automatic…

A: Deficit is the difference b/w the amount that is received and what is spent by the government of a…

Q: Identify the effects of fiscal policy on the economy

A: Fiscal policy refers to the government policy that stabilizes th economy through bring changes in…

Q: Why is getting the magnitude, or dollar size, of the policy change just right the most difficult…

A: Discretionary fiscal policy is a government policy used for raising the aggregate demand/ spending…

Q: When the economy is in a recessionary mode, what will likely be the actions by government using…

A: The government's policy to manage the money supply in the economy is known as fiscal policy. This…

Q: What is macro stability and resource mobilization in fiscal policy?

A: In an economy, fiscal policy implies the action of the government to influence the aggregate demand…

Q: When the economy is in a recessionary mode, what will likely be the actions by government using…

A: In recessionary mode, the government pursue the expansionary fiscal policy which has two tools which…

Q: Why tax cuts can increase both aggregate demand and aggregate supply?

A: In an economy, taxation refers to one of the government tools to influence a market situation and to…