Why it could be the case that after an initial sharp increase, the budget deficit could drop through time (as it did in the USA after the 2008 financial crisis)?

Q: Discuss some of the difficulties that may arise from enacting and carrying out fiscal policy and why…

A: Macroeconomic analysis provides a comprehensive picture of the financial status of an economy. It…

Q: Explain how, for a country with a high debt ratio, if the financial markets fear that the country…

A: Economics as a subject deals with the allocation of scarce resources among humans with unlimited…

Q: Will Increase in government spending financed by borrowing help promote a strong recovery from a…

A: A recession is a period of an economic downturn that is caused due to the depletion of aggregate…

Q: What is the reason why fiscal policy should be in tune with monetary policy when the economy is in…

A: Fiscal policy can be defined as government policies and the spending pattern that the government…

Q: Why did the budget surpluses in 2000 and 2001 give way to a series of budget deficits beginning in…

A: In the 2000 and 2001 budget surplus was 2.5% and the cyclical adjusted budget surplus was 1% to the…

Q: Please evaluate the following statement: When the U.S. federal government has a budget…

A: A budget deficit  basically occurs when a government spends more money than it collects in a certain…

Q: In the fiscal year​ 2019, the projected U.S. federal government deficit totaled​ $960 billion, which…

A: The budget deficit in the United States increased to $960 billion in the 2019 fiscal year, a 23.2…

Q: From 2008, how might monetary policy (as reflected in the OCR) have affected the degree of crowding…

A: Monetary policy refers to change in money supply and money demand by central banks through open…

Q: Was fiscal policy effective when the US economy was experiencing stagflation during the 1970s? Why…

A: Stagflation alludes to a circumstance when the economy was confronting high inflation and high…

Q: Do you agree that the increase in national debt of the country have an effect to the growth of the…

A: Country seeks Debt to finance the deficit budget or repayment debt . This helps to expand the size…

Q: Explain what effect a large federal deficit might have on interest rates?

A: The deficit in the budget arises when the government faces higher government spending with lesser…

Q: In an attempt to reduce the large budget deficit, the government raised taxes and reduced government…

A: The use of taxation and expenditure by the government to affect the economy is known as fiscal…

Q: Will a budget deficit be more expansionary if it is financed by borrowing from the Federal Reserve…

A: If the budget deficit is financed by borrowing from Federal Reserve, it will cause to increase the…

Q: Describe how the federal deficit is a burden on the shoulders of future generations.

A: Answer: Introduction: Deficit or budget deficit refers to the excess of spending over revenue. In…

Q: Of the four major economies , US, China, Japan, and Germany, which ones have also been running…

A: Budget Deficit:A budget deficit occurs when a government's expenditures exceed its revenues during a…

Q: What would happen to the budget deficit if the: a) GDP growth rate jumped from 1 percent to 3…

A: A budget deficit occurs when the actual expenses of the government exceed its total revenue.

Q: if the government budget deficit equals $240 billion and the money supply increases by $100 billion,…

A: The budget deficit is an excess of government spending over its revenue. To meet the deficit, the…

Q: How is the Social Security system currently influencing the size of the budget deficit? If it is not…

A: The budget deficit creates the problem in the economy. When there is budget deficit, it will leads…

Q: Answer the following questions: As you know, the US government has been running budget deficits for…

A: Budget shortfalls in the USA have varied across periods. Significant contributors to deficits…

Q: Many countries have constitutional requirements that their budgets be in balance (or in surplus) in…

A: A balanced budget refers to when, during a given period, the government spends an amount equal to…

Q: In which of the following cases does the size of the government’s debt and deficit indicate…

A: The management of a government's fiscal policies like its debt and deficits, plays a important  role…

Q: In theory, fiscal policy can be as effective in stabilizing the economy as is monetary policy. What…

A: Fiscal policy is the policy that is made to achieve the stability by the government by using its…