Question
In the recently announced Federal budget, the Australian Treasurer, Mr. Josh Frydenberg has outlined a number of initiatives. Attached please find one news report highlighting
In the recently announced Federal budget, the Australian Treasurer, Mr. Josh Frydenberg has outlined a number of initiatives. Attached please find one news report highlighting the major steps announced in the budget https://www.9news.com.au/national/federal-budget-2022-two-minute-guide-tax-relief-one-off- payments-fuel-excise-halved/1dae4dd4-0075-4ce7-9eb4-5226b9b2c83a3 Based on your understanding of the Aggregate Expenditure model, explain how such policy measures would affect the macroeconomy in the short run. Provide adequate illustration of the Aggregate Expenditure model and show how the budgetary actions would impact the economy using the model. [Note that when answering this question, you do not have to use actual numbers from the budget. You can use some hypothetical numbers in support of your argument.]
from my understanding, the policies that were included in the announcement are transfer payments which don't affect Aggregate Expenditure but it does affect consumption which in turn affects Aggregate Expenditure. I am not sure how to draw this on the graph
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started