Question
If a government increases G by the same amount as it raises taxes, the aggregate output actually rises. Why is this? Suppose an economy has
If a government increases G by the same amount as it raises taxes, the aggregate output actually rises. Why is this? | ||
Suppose an economy has an equilibrium output of 3000, consisting of 1800 of consumption and 1200 of investment. | ||
If government spending is set at 750, financed by a tax rate of 25 percent , what will happen to output? | ||
Assume, that at the beginning there was no G and T. | ||
The change of aggregate output due to G | Atsakymas | |
The change of aggregate output due to T | Atsakymas | |
Total change of aggregate output. | Atsakymas |
Calculate both fiscal multipliers without taxes (not considering the tax rate).
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