Macroeconomics, attached module problems....

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Question

1. The federal budget
Year
1998
2000
2002
2004
2006
Revenu Expenditur
Rev as %
Exp as %
es
es
GDP
GDP
GDP
Deficit
1722
1653
8747
20%
19%
69
2025
1789
9817
21%
18%
236
1853
2011
10470
18%
19%
-158
1880
2293
11686
16%
20%
-413
2407
2655
13178
18%
20%
-248
Government's budget was in deficit in 2002, 2004 and 2006
In 2002, Public debt increases by 1%
Impact of income tax cut on aggregate supply (SRAS) and aggregate demand curves
demand side
Impact of income tax cut on aggregate supply (SRAS) and aggregate demand curves
Supply side
Supply side policy
1. Income tax cut
2. Increases supply of labor
3. Aggregate supply shifts out to the right
4. Real GPD increases and price level decreases
Demand side policy
1. Income tax cut
2. Increases consumption spending
3. Aggregate demand shift to the right
4. Real GDP increases and price level increases
7. Understanding marginal and average tax rates.
Under Plan A
500- since it does not go above the 1,000 limit it will be taxed at 20%. The 20% is your marginal tax
AND your average tax since it did not go above the limit
1,500- since it does go above the...

 

Solution ID:350927 | This paper was updated on 26-Nov-2015

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