Chapter 31 (Final Exam)

Which combination of policies would be the most expansionary?

An economy is in a recession and the government decides to increase spending by $4 billion. The MPC is 0.8. What would be the full increase in real GDP from the change in government spending?

Which combination of fiscal policies would be the most contractionary?

If the cyclically adjusted deficit as a percentage of GDP is zero one year, and there is a cyclically adjusted surplus the next year, it can be concluded that...

The length of time involved for the fiscal action taken by Congress to affect output, employment, or the price level is referred to as the...

The crowding-out effect of an expansionary fiscal policy is the result of government borrowing in the money market that...

Current thinking about discretionary fiscal policy among mainstream economists is that is should be designed too...

The public debt is the sum of all previous...

To place the public debt in perspective based on the wealth and productive capacity of the economy, it is more meaningful to...

According to many economists, the primary burden of the debt is the...

Which is an important consequence of the public debt of the United States?

Greater interest charges on the public debt can lead to...

The crowding-out effect of borrowing to finance an increase in government expenditures...

In which year did the fiscal policy become more expansionary?