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    Devry University
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Category > Accounting Posted 20 Dec 2017 My Price 10.00

to pursue an expansionary fiscal policy


 

31.

If a government wants to pursue an expansionary fiscal policy, then a tax cut of a certain size will be more expansionary when the:

A.

Economy's MPS is small

 

B.

Economy's MPS is large

 

C.

Economy's MPC is small

 

D.

Unemployment rate is low

 

32.

Which of the following fiscal policy changes would be the most expansionary?

A.

A $40 billion increase in government spending

 

B.

A $20 billion tax cut and $20 billion increase in government spending

 

C.

A $10 billion tax cut and $30 billion increase in government spending

 

D.

A $40 billion tax cut

 

33.

Which of the following expansionary fiscal policy changes would be most favored by those economists who think that the government is too large and inefficient?

A.

A $40 billion increase in government spending

 

B.

A $20 billion tax cut and $20 billion increase in government spending

 

C.

A $10 billion tax cut and $30 billion increase in government spending

 

D.

A $40 billion tax cut

 

34.

An economy is experiencing a high rate of inflation. The government wants to reduce consumption by $36 billion to reduce inflationary pressure. The MPC is 0.75. By how much should the government raise taxes to achieve its objective?

A.

$6 billion

 

B.

$9 billion

 

C.

$12 billion

 

D.

$16 billion

35.

Discretionary fiscal policy will stabilize the economy most when:

A.

deficits are incurred during recessions and surpluses during inflations.

 

B.

the budget is balanced each year.

 

C.

deficits are incurred during inflations and surpluses during recessions.

 

D.

budget surpluses are continuously incurred.

 

Answers

CourseLover
(12)
Status NEW Posted 20 Dec 2017 07:12 AM My Price 10.00

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