Explain why permanent tax cuts are likely to lead to bigger increases in consumer spending than temporary

Question:

Explain why permanent tax cuts are likely to lead to bigger increases in consumer spending than temporary tax cuts do.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Macroeconomics Principles And Policy

ISBN: 9780324586213

11th Edition

Authors: William J. Baumol, Alan S. Blinder

See More Books

Question Posted: Sep 01, 2012 02:45 AM

See More Questions

What circumstances are likely to lead to the formation of continental-scale glaciers?
Explain why temporary and permanent fiscal expansions do not have different effects under fixed exchange rates, as they do under floating exchange rates.
Do volume increases that lead to spending increases cause financial problems for organizations?
???????Need answer for below questionWoolworth Ltd, After Pay Ltd, and Santos Ltd for the years 2021,2020 and 2019. Examine the consolidated Cash Flow Statements foreach companies acr f) If the firm...
An air-standard Stirling cycle shown in Fig. 9.42 operates with a minimum pressure of 75 kPa, a compression ratio of 15, and a high temperature of 1000ºC. The heat is rejected at 40°C. Using...
Study the key behavioral phenomena underlying employee reactions to stress, such as threats to selfesteem, frustration tolerance level, loss of control, defense mechanisms, and values conflicts. lop5
A study reported in the Journal o,f Psychology (Mar. 1991) measures the change in female students' selfconcepts as they move from high school to co1lege.A sample of 133 Boston College first-year...
On December 12, 2013, Pace Electronics received $24,000 from a customer toward a cash sale of $240,000 of diodes to be completed on January 16, 2014. What journal entries should Pace record on...
Balance Sheet Corporation XYZ, (December 31, 2019) Assets Cash Accounts Receivable Inventories Total Current Assets Gross Fixed Assets $35,000 Less: Accumulated Depreciation 13,250 Net Fixed Assets...
Evaluating debt burden. Ted Phillips has a monthly take-home pay of $1,685; he makes payments of $410 a month on his outstanding consumer credit (excluding the mortgage on his home). How would you...
What is a consumption function, and why is it a useful device for government economists planning a tax cut?
In 2001 and again in 2003, Congress enacted changes in the tax law designed to promote saving. If such saving incentives had been successful, how would the consumption function have shifted?
With reference to Fig. 8.M4, which one represents a fork node? (a) a (b) b (c) c (d) d 1 Contract loks (a) (c) Fig. 8.M4 (b) (d)
Write a function that takes as input a non-negative integer in the range 0 to 99 and returns the English word(s) for the number as a string. Multiple words should be separated by a space. If the...
The Event Manager sighed as the festival approached and she had only five crafts vendors who had committed to taking part in the marketplace. She and her assistant were frantic. They had been...
the systematic recording, analysis, and interpretation of costs incurred by a business. Its significance extends beyond mere financial tracking; it plays a pivotal role in aiding management...
1.What is your process for ensuring that all your work is correct? 2.What do you mean by Batch Costing ? 3.Explain the accounting procedure for Batch Costing 4.State the applicability of Job Costing...
The increasing occurrence of freak weather incidents will have both local and global effects. Even in cases where production has been re-localized, freak weather can still greatly impact local...
Will a perpetual or a periodic inventory system lead to the greatest amount of cost of goods sold reported in a period? Explain.
Refer to the situation described inBE 18-13, but assume a 2-for-1 stock split instead of the 5% stock dividend. Prepare the journal entry to record the stock split if it is to be effected in the form...
Use proof by contradiction to show that the number is irrational. $\sqrt{3}$
Explain why firms in an industry that spends a large amount of money on advertising may feel locked into their current advertising budgets, with no one firm daring to cut its expenditure. Describe...
Explain why firms in an industry that spends a large amount of money on advertising may feel locked into their current advertising budgets, with no one firm daring to cut its expenditure. Describe...
Alexander Graham Bell beat Elisha Gray to the patent office by several hours, so that Bell obtained the patent on the telephone. Imagine how much that patent turned out to be worth. How much do you...
Required : a- outline the statement of comperhensive income for the year ended 30 november 2021 b- outline the statment of financial position as at 30 November The Trial Balance of Alim Enterprise at...
International business and environment The MIR requires teams to gather current, or the most recently available, data on the markets people, economy, government, and technological status from online...
Consider the following stream of cash flows. The interest rate is 10%. 0 1 2 3 4 5 6 7 100 100 100 200 0 300 300 300 a) What is the value at time 0 of the cash flow stream? b) What is the value of...

Explain why permanent tax cuts are likely to lead to bigger increases in consumer spending than temporary

Question:

Step by Step Answer:

People tend to base their consumption expenditures not just on their curr...View the full answer

Macroeconomics Principles And Policy

Students also viewed these Economics questions