In Microsoft Word type answer and insert your graph to complete the assignment.

1. Explain the impact of the lump sum tax through the use of an MPS of 1/5 and 1/4 on the domestic economy.

2. Graph the difference between the inflationary & recessionary gaps.

3. Explain the difference between discretionary versus nondiscretionary fiscal policy.

4. List the problems of timing with fiscal policy, p. 276.

5. List and explain the two false concerns about the public debt, p. 280.

6. Complete #6 of Problems at the end of the chapter 13 p. 287.

7. Describe the composition of the U.S. public debt related to domestic & foreign holdings as illustrated in Figure 13.5.

APPENDIX DISCUSSION QUESTIONS E connect 1. Compare and contrast the Bretton Woods system of exchange rates with that of the gold standard. What caused the collapse of the gold standard? What caused the demise of the Bretton Woods system? LO20.7 { 2800f446 > 2 Aa The Rich and the Poor LO211 Distinguish between industrially advanced countries and developing countries. Just as there is considerable income inequality among families within a nation, so too is there great income inequality among nations. According to the United Nations, the richest 20 percent of the world's population receives more than 75 percent of the world's income; the poorest 20 percent receives less than 2 percent. The poorest 60 percent receives less than 6 percent of the world's income. Classifications The World Bank classifies countries into four income categorieshigh-income, upper-middle-income, lower-middle-income, and low- incomeon the basis of national income per capita, as Figure 21.1 shows. The higl-income nations, shown in dark green, are known as the industrially advanced countries (IACs). They include the United States, Japan. Canada, Australia, New Zealand, and most of western Europe. In general, these nations have well-developed market economies based on large stocks of capital goods, advanced production technologies, and well-educated workers. In 2020 this group of economies had an average per capita income of $46,036. Page 451 FIGURE 21.1 Groups of economies. The world's nations are grouped into industrially advanced countries (IACs) and developing countries (DVCs). The IACs (shown in dark green) are high-income countries. The DVCs are upper-middle-income, lower-middle-income, and low-income countries (shown respectively in light green, yellow, and orange). { 2870f446 > 2 Aa DISCUSSION QUESTIONS connect 1. What are the four categories used by the World Bank to classify nations on the basis of national income per capita? Identify any two nations of your choice for each of the four categories. LO21.1 2. Explain how the absolute per capita income gap between rich and poor nations might increase, even though per capita income (or output) is growing faster in DVCs than in IACs. LO21.1 3. Explain how each of the following can be obstacles to the growth of income per capita in the DVCs: lack of natural resources, large populations, low labor productivity, poor infrastructure, and capital flight. LO21.2 4. What is the demographic transition? Contrast the demographic transition view of population growth with the traditional view that slower population growth is a prerequisite for rising living standards in the DVCs. LO21.2 5. As it relates to the vicious circle of poverty, what is meant by the saying \"Some DVCs stay poor because they are poor Change the box labels as necessary in @ Figure 21.3 to explain rapid economic growth in countries such as South Korea and Chile. What factors other than those contained in the figure might contribute to that growth? LO21.3 6. Because real capital is supposed to earn a higher return where it is scarce, how do you explain the fact that most international investment flows to the IACs (where capital is relatively abundant) rather than to the DVCs (where capital is very scarce)? LO21.3 7. What factors cause failed states? List and discuss five policies that DVC governments might undertake to promote economic development and expansion of income per capita in their countries. LO21.4 8. Do you think that the problems the DVC's face require a government-directed or a private-sector-directed development process