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If the government wants to increase real
- A) decrease government expenditures and increase taxes.
- B) increase government expenditures.
- C) decrease government expenditures.
- D) increase taxes.
Step by step
Solved in 2 steps
- You are given data on the following variables in an economy: Government spending 300, Total Investment 200, Net Exports 50, Total Tax Revenue 250, Income tax rate 10%. How much income should been arned by the businesses and the individuals in order for the government to reach a balanced budget?During an economic _______, there is a decline in economic activity, including falling GDP, rising unemployment, and reduced consumer spending. To combat this, governments often implement _______ fiscal policies to stimulate the economy. A) expansion, contractionaryB) downturn, expansionaryC) boom, contractionaryD) recession, expansionary.Do tax cuts increase economic growth and taxable income so much that tax revenue increases?
- TAXES Taxes are any governmental action that reduces the real income of wage-earners as well as non-working Americans. The action can also reduce the profit of business. Taxes act as a leakage from the GDP – Income Stream and will reduce both income and GDP over time. Think of taxes…. Did you buy gas on the way to school? Did it include a tax? When you purchase clothing at the mall, how much is the tax? Driver’s License? Fishing License? Hunting License? Tax on Concert Ticket? Tax on Airline Ticket? Are taxes withheld from your paycheck? Income, FICA and state or local taxes Paying bridge tolls? Taxes on personal or real property? Tax on new tires? Alcohol? Cigarettes? Imports with tariffs? Do all these taxes and licenses reduce our disposable income? Why do we sacrifice and pay these taxes? What are the ways that government helps us?If government increases spending and wants to maintain a balanced budget, it shouldThe establishment of a new government affect the economy in various ways. Explain how the economy gets affected by it.
- If the government decreases taxes, disposable income does not change. falls. increases. This causes total consumer spending to not change. increase. decrease.How do you recommend the government change GDP and taxes to stabilize the economy in each of the following scenarios? Economic growth has started slowing and the unemployment rate has increased over the past four months. There has been strong growth in GDP over the past year, unemployment is very low, and inflation has started to rise. Prices are stable, unemployment is low and the economy is growing at an average rate.i) Calculate total government expenditures. ii)Calculate total government spending. iii)Is the government running a surplus, deficit, or a balanced budget?
- ECONOMICS An economy has neither imports nor income taxes. The MPC is 0.75 and the real GDP is $120 billion. The government increases expenditures by $4 billion. The multiplier is _____ and the change in real GDP from the increase in government expenditures is _____ billion.Which system of taxes is best? Why does that system is the most effective way for the government to generate revenue and maintain our economy's growth?Should the government fight recessions with spending hikes rather than tax cuts ? Explain.
