If the marginal propensity to consume is 08 and

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155.If the marginal propensity to consume is 0.8 and government transfers decrease by $50 million, then equilibrium GDP will decrease by:A)$40 million.B)$50 million.C)$200 million.D)$250 million.
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156.A cut in taxes will have the most effect on aggregate demand if it is given to:
157.Discretionary fiscal policy entails:
158.Discretionary fiscal policy refers to changes in:
159.Suppose the government increases spending to fund tuition for qualified university students. Automatic stabilizers will _____ the _____ effect of the _____ in aggregate demand.A)increase; contractionary; decreaseB)decrease; contractionary; increaseC)increase; expansionary; increaseD)decrease; expansionary; increase
160.Suppose the federal government increases personal income tax rates to balance the budget. Automatic stabilizers will _____ the _____ effect of the _____ in aggregate demand.
161.When the economy expands, income tax receipts will:
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162.The automatic stabilizer in government tax revenue that occurs when GDP rises _____ the multiplier.
163.The fact that tax receipts fall during a recession:A)makes the multiplier stronger.B)has no impact on the multiplier.C)reduces the adverse effect of the initial fall in aggregate demand.D)acts as an automatic contractionary fiscal policy.
164.Fiscal policies that require no government action but that are expansionary when the economy contracts and contractionary when the economy expands are known as:

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