1. The government plays a large role in the economy, collecting a large share of GDP in...
Question:
1. The government plays a large role in the economy, collecting a large share of GDP in taxes and spending a large share both to purchase goods and services and to make transfer payments, largely for social insurance. Fiscal policy is the use of taxes, government transfers, or government purchases of goods and services to shift the aggregate demand curve. But many economists caution that a very active fiscal policy may in fact make the economy less stable due to time lags in policy formulation and implementation.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Essentials Of Economics
ISBN: 9781429218290
2nd Edition
Authors: Paul Krugman, Robin Wells, Kathryn Graddy
Question Posted: