Macroeconomics
13th Edition
ISBN: 9780134744452
Author: PARKIN, Michael
Publisher: Pearson,
expand_more
expand_more
format_list_bulleted
Question
Chapter 13, Problem 14APA
(a)
To determine
Explain the impact of government budget balance on investment.
(b)
To determine
Explain the fiscal policy action of increase in investment and
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
explain on a graph what would happen if the government discouraged investment through tax policy and explain your answers
Assume the Philippines government adopted fiscal policy measures to reduce the severety of typhoon Haiyan on the economy. Answer the questions below.
Did typhoon Haiyan cause economic expansion or a recession? Explain your answer using at least two economic effects on the Philippines economy.
Examine the effects of government expenditure as a fiscal policy measure on the Philippines economy.
If Investment = f(r*)
a. Explain with pictures how it affects the balance of Supply/Saving and Investment Demand in the event of Fiscal policy, namely by decreasing state spending and increasing taxes.
b. Explain with pictures how it affects the balance of Supply/Saving and Investment Demand in the event of Fiscal policy, namely by decreasing state spending and increasing taxes if it happens overseas
Chapter 13 Solutions
Macroeconomics
Ch. 13.1 - Prob. 1RQCh. 13.1 - Prob. 2RQCh. 13.1 - Prob. 3RQCh. 13.1 - Prob. 4RQCh. 13.1 - Prob. 5RQCh. 13.2 - Prob. 1RQCh. 13.2 - Prob. 2RQCh. 13.2 - Prob. 3RQCh. 13.2 - Prob. 4RQCh. 13.2 - Prob. 5RQ
Ch. 13.3 - Prob. 1RQCh. 13.3 - Prob. 2RQCh. 13.3 - Prob. 3RQCh. 13.3 - Prob. 4RQCh. 13.3 - Prob. 5RQCh. 13.4 - Prob. 1RQCh. 13.4 - Prob. 2RQCh. 13.4 - Prob. 3RQCh. 13.4 - Prob. 4RQCh. 13.4 - Prob. 5RQCh. 13 - Prob. 1SPACh. 13 - Prob. 2SPACh. 13 - Prob. 3SPACh. 13 - Prob. 4SPACh. 13 - Prob. 5SPACh. 13 - Prob. 6SPACh. 13 - Prob. 7SPACh. 13 - Prob. 8SPACh. 13 - Prob. 9SPACh. 13 - Prob. 10SPACh. 13 - Prob. 11SPACh. 13 - Prob. 12APACh. 13 - Prob. 13APACh. 13 - Prob. 14APACh. 13 - Prob. 15APACh. 13 - Prob. 16APACh. 13 - Prob. 17APACh. 13 - Prob. 18APACh. 13 - Prob. 19APACh. 13 - Prob. 20APACh. 13 - Prob. 21APACh. 13 - Prob. 22APACh. 13 - Prob. 23APACh. 13 - Prob. 24APACh. 13 - Prob. 25APACh. 13 - Prob. 26APACh. 13 - Prob. 27APACh. 13 - Prob. 28APA
Knowledge Booster
Similar questions
- Should the government fight recessions with spending hikes rather than tax cuts ? Explain.arrow_forwarda) 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?arrow_forwardWhich is considered expansionary fiscal policy? a)a tax increase for wealthy individuals b)an increase in national defense spending c)regulations raising emission standards on trucks d)an increase in the money supplyarrow_forward
- Suppose the government implements contractionary fiscal policy. As a result, the inflation rate will likely _____ and the real growth rate will likely _____ in the short run. Rise or fall?arrow_forwardWhich one of the following statements regarding fiscal policy and the budget is correct?(a) When the government plans to stimulate economic activity, it can increasespending or reduce taxes;(b) Revenue from tax is always greater than government spending in SouthAfrica;(c) Demand management only refers to fiscal policy;(d) A contractionary fiscal policy should be implemented to combatunemployment.arrow_forwardHow will a contractionary fiscal policy affect a budget deficit? A.) Debts will decrease B.) No impact C.) Deficit will increase D.) Deficit will decreasearrow_forward
- Using diagrams can you please show how the rise in the household saving rate can cause a fall in GDP, and how a fiscal stimulus might off this? (thank you - will thumb up answer when I see it)arrow_forwardThe 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?arrow_forwardFiscal policy is spending and taxation of the executive branch of the federal government; in recessionary times, what initiatives in spending and or taxation are going to help the economy?arrow_forward
- A fiscal Policy that seeks to promote stability and economic growth through tax cuts is?a) Restrictive Fiscal Policyb) Easy Money Policyc) Tight Money Policyd) Expansionary Fiscal Policyarrow_forwardShould fiscal policy encourage more consumption or more saving? Does it matter? I need a reason why.arrow_forwardNeed AI free solution Amid an economic recession, a government decides to implement an expansionary fiscal policy. This policy includes increasing government spending on infrastructure projects and reducing taxes to stimulate demand and create jobs. While the policy aims to boost economic activity, it also risks increasing the national debt and potentially leading to higher inflation. In this scenario, the primary objective of the expansionary fiscal policy is to: ) Reduce government spending and increase taxes A B) Stimulate economic activity and job creation C) Focus solely on long-term economic growth D) Increase the national debt and inflationarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
