Survey Of Economics
10th Edition
ISBN: 9781337111522
Author: Tucker, Irvin B.
Publisher: Cengage,
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Please explain and give examples of significance of the distinction between discretionary and non-discretionary fiscal policy.
Discuss two reasons why discretionary fiscal policy (expansionary & contractionary) may be ineffective
Explain how the Finance Minister is held accountable.
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- Do you think the typical time lag for fiscal policy is likely to be longer or shorter than the time lag for monetary policy? Explain your answer?arrow_forwardWhat are some practical weaknesses of discretionary fiscal policy?arrow_forwardCompare and contrast the strengths and weaknesses of fiscal policy and monetary policy. In 1300 wordsarrow_forward
- Discuss the difficulty in predicting the effects of discretionary fiscal policy.arrow_forwardAnalyse how and why bond and share prices will be affected by an unexpected fiscal expansion. Will the outcome differ if the expansion is anticipated?arrow_forwardOne of the main arguments against using Fiscal Policy is the crowding out effect. Suppose the government uses government purchases to stimulate the economy. Explain quantitative easing? If the Fed’s current policy is quantitative easing, do you think that there is a danger of the government’s current fiscal policy being crowded out? Why or Why not? Explanation required.arrow_forward
- How and why would automatic continuing resolutions be effective at influencing budget reforms and reducing deficits?arrow_forwardWhat will be the effect of sales of government bonds? Increase aggregate supply Decrease aggregate demand Decrease aggregate supply Increase aggregate demandarrow_forwardList what specific, deliberate actions the federal government could take to enact expansionary fiscal policy.arrow_forward
- Identify and briefly describe at least four practical difficulties of discretionary fiscal policy.arrow_forwardClearly distinguish between expansionary and contractionary fiscal policy.arrow_forwardThe Crowding Out hypothesis predicts: a. Annual deficits when financed with debt result in higher investment and lower interest rates. b. Annual surpluses when financed result in higher investment and lower interest rates. c. Annual deficits when financed with debt result in reduced investment and higher interest rates.arrow_forward
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