ECO 210 Ch 13

Refer to the graph. What combination would most likely cause a shift from AD1 to AD2?

Refer to the above graph. What combination would most likely cause a shift from AD1 to AD3?

One of the potential consequences of the public debt is that it may:

Assume that the economy is in a recession and there is a budget deficit. A strict balanced-budget rule that would require the Federal government to balance its budget during a recession would be:

The goal of expansionary fiscal policy is to increase:

Which combination of fiscal policy actions would most likely offset each other?

The following is budget information for a hypothetical economy. All data are in billions of dollars. Refer to the table. The budget deficit was $75 billion in: Government Spending Tax Revenues GDP Year 1 $800 $825 $4,000 Year 2 $850 $850 $4,200 Year 3 $900 $875 $4,350 Year 4 $950 $900 $4,500 Year 5 $1,000 $925 $4,600

Refer to the figure. The economy is at equilibrium at point A. What fiscal policy would be most appropriate to control demand-pull inflation?

When the Federal government uses taxation and spending actions to stimulate the economy it is conducting:

The crowding-out effect arises when:

One timing problem in using fiscal policy to counter a recession is the "recognition lag" that occurs between the:

A Federal budget deficit exists when:

How is the public debt calculated?

The following is budget information for a hypothetical economy. All data are in billions of dollars. Refer to the table. Assume that Year 1 is the first year for this economy and Year 5 is the current year. What is the public debt in this economy at Year 5? Government Spending Tax Revenues GDP Year 1 $800 $825 $4,000 Year 2 $850 $850 $4,200 Year 3 $900 $875 $4,350 Year 4 $950 $900 $4,500 Year 5 $1,000 $925 $4,600

Proponents of the notion of a "political business cycle" suggest that:

The following is budget information for a hypothetical economy. All data are in billions of dollars. Refer to the table. In which year is there a budget surplus? Government Tax Spending Revenue GDP Year 1 $800 $825 $4,000 Year 2 $850 $850 $4,200 Year 3 $900 $875 $4,350 Year 4 $950 $900 $4,500 Year 5 $1,000 $925 $4,600

If Congress passes legislation to increase government spending to counter the effects of a recession, then this would be an example of a(n):

The intent of contractionary fiscal policy is to:

If people expected that a fiscal policy in the form of a tax cut was temporary, then this policy's effect on the economy will tend to be:

The set of fiscal policies that would be most contractionary would be a(n):

Most economists believe that fiscal policy is: Question options: A) Not very good at pushing the economy in a particular direction B) Better than monetary policy for month-to-month stabilization C) Not as good as monetary policy for month-to-month stabilization D) Better than monetary policy for "fine-tuning" the economy