The recent economic recession was brought about by the Covid-19 pandemic. The pandemic brought along mitigation efforts such as stay-at home/shelter in place orders, cancelling of large gathering, social distancing, etc,. What impact have these mitiation efforts likely had on the MPC and the multiplier in the U.S. economy? What does this imply about the effectiveness and level of fiscal policy needed to bring the U.S. economy out of the recession.

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A: Given  Short run, real GDP is $3000 and Full employment GDP is $4000 MPC=0.75. We know from the…

Q: Distinguish between automatic fiscal policy and discretionary fiscal policy. What type of fiscal…

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Q: discuss the economic implications of  Joe Biden’s fiscal stimulus for the US economy and the…

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

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Q: Explain how the fiscal policy tools used by the federal government should work in terms of fighting…

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Q: Suppose that the economy is experiencing a recession with an estimated recessionary gap of $30…

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

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Q: how discretionary fiscal policy fights recession and inflation

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Q: a. Based on the macro workhorse model, explain the 'journey' (mechanism) how an initial…

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

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Q: What is the role of the Council Economic Advisers (CEA) as it relates to the effectiveness of the…

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Q: Define what is 'automatic stabiliser' in fiscal policy, and provide 2 examples

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A: The value of MPC can be calculated as follows. The value of MPC is 0.883721.

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