Question

In: Economics

Of the following examples, which is associated with government spending for investment? The federal government spends...

Of the following examples, which is associated with government spending for investment?

The federal government spends $2 million on updating and improving the security for the White House.
The federal government spends $5 million on office supplies for federal offices.
The federal government spends $400 million on fixing airports and upgrading control tower software and technology.

If Congress passed a new budget that increased taxes it would

increase the gross domestic product to a new equilibrium as aggregate demand shifted to the left
reduce the gross domestic product to a new equilibrium as it rises and the aggregate demand shifts to the right.
reduce the gross domestic product to a new equilibrium as aggregate demand shifted to the left.

Contractionary fiscal policy is recommended when

a recession has taken place.
unemployment is on the rise.
inflation has reached harmful levels.

Assume the government has a budget deficit and that the economy is experiencing a period of growth higher than predicted, tax receipts (collected) by the government are likely to

increase and increase the budget deficit.
decrease and increase the budget deficit.
increase and reduce the budget deficit.

Solutions

Expert Solution

Rahul Sunny answered 2 years ago
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