t other question wil save this response.Quèstion 13T1T20.GDPRefer to the diagram. Discretionary fiscal policy designed to expand GDP is illustrated byO A. the shift of curve T1 to T2,O B. a movement from d tob along curve T1.OC, the shift of curve T2 to T1.O D.a movement from a to c along curve T2.Government Purchasesand Tax Revenues

Answer: To slow down the economy, government uses contractionary fiscal policy, by decreasing…

Quèstion 13 T2 A B GDP Refer to the diagram. Discretionary fiscal policy designed to expand GDP is illustrated by O A. the shift of curve T1 to T2, O 8, a movement from d to b along curve T1. OC the shift of curve T2 lo T1 O D,a movement from a to c along curve T2. Government Purchases and Tax Revenues -----

Quèstion 13 T2 A B GDP Refer to the diagram. Discretionary fiscal policy designed to expand GDP is illustrated by O A. the shift of curve T1 to T2, O 8, a movement from d to b along curve T1. OC the shift of curve T2 lo T1 O D,a movement from a to c along curve T2. Government Purchases and Tax Revenues -----

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Asap both 1.a) Which of the following statements is correct?l.Expansionary fiscal policy is used to remove a recessionary gap.ll. Expansionary fiscal policy is used to shift AD right.A) l onlyB) I onlyC)both I and ID) neither I nor ll 1.b) Which of the following are examples of contractionary fiscal policy?A) decreasing government expendituresB) increasing taxesC) increasing transfer paymentsD) A and B are both contractionary fiscal policiesE) A, B, and C are all contractionary fiscal policies
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Refer to the figure at right. Government policy that moved the economy from A to B would be accomplished by O A. an expansionary fiscal policy combined with a contractionary monetary policy. O B. OC. a contractionary fiscal policy combined with an expansionary monetary policy. a contractionary policy that would reduce the rate of inflation and would cause workers to remain unemployed longer than they were before. O D. raising the minimum wage. Inflation Rate 2.5 A B I 6 D Unemployment Rate
An expansionary fiscal policy that takes the form of an increase in government purchases carries the possibility that private investment and, as a result, the future growth rate of O a. Is crowded out, potential output is reduced. O b. Rises to an unsustainable level; real GDP is reduced. O c. Increases, net exports increases. O d. Is crowded out; corporate tax revenue is reduced. e Increases, aggregate demand increases.
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Today the federal government collects nearly O $1 billion a year in tax revenues. O $500 billion a year in tax revenues. O $1 trillion a year in tax revenues. O $4 trillion a year in tax revenues.
Given an upward-sloping short-run AS curve, expansionary fiscal policy (ceteris paribus) will result in: (i) Higher prices in the short run (ii) Higher output in the short run (iii) Higher prices in the long run (iv) Higher output in the long run O a. Only (i) and (ii) O b. Only (iii) and (iv) O c. Only (ii) and (iii) O d. Only (i) and (iv)
It can be argued that a government budget deficit, rather than being a burden for future generations, may provide net benefits to future generations. This view is correct if the current budget deficit is used to... O a Pay transfers such as welfare and old age pensions in the present period. O b. Ensure that all interest paid goes to residents rather than foreigners. O c. Finance projects that deliver long-term benefits to society. O d. Invest in the purchasing of goods not available in the local economy O e. Pay subsidies to Canadian firms to offset rising energy costs.
Suppose the government incurs more debt to finance new military spending. To what extent will this impose a burden on future generations? O a. Government spending on military is considered investment expenditure. O b. Military spending does not at all benefit the future generations. O c. Government spending crowds out private investment spending. O d. Government debt needed to finance military expenditures is held by domestic entities.
If the government were to try to offset surplus years with deficit years over the business cycle, this would result in O A. a reduction in investment capital. O B. a higher debt-to-GDP ratio. OC. an annually balanced budget. O D. a structurally balanced budget. O E. a cyclically balanced budget.