Assume the government proposes to cut taxes

Reference no: EM1338353

Suppose the government proposes to cut taxes while maintaining the current level of government expenditures. To finance this deficit, it may either

a) sell bonds to the public, or, b) print new money (via Federal reserve cooperation).

-What are the likely effects of each of these alternatives on each of the following?

a) interest rates
b) consumer spending
c) business investment
d)aggregate demand.

Would Keynesians , monetarists, and supply-siders give the same answers?

Reference no: EM1338353

Questions Cloud

Bottleneck process : Identifying a process bottleneck

What are some of the problems related to this : What are some of the problems related to this

Organization evaluate project complexity : How and why does that organization evaluate project complexity?

Explain guide for founder''s agreement and other legal issues : Explain Guide for Founder's Agreement and Other Legal Issues and Describe the purpose of a buyback clause and why it's important

Assume the government proposes to cut taxes : Assume the government proposes to cut taxes while maintaining the current level of government expenditures. To finance this deficit, it may either.

Defining the history : What do we mean by history? Is history the search for truth? Is our understanding of what we mean by history dependent on our own societal background.

Give difference between perception and reputation : give difference between perception and reputation

Internal consultant : What if the Internal Consultant has intimate knowledge of the organization and has a different perspective on Operations than one particular line manager. Is it permissable to say 'no' in this case? why or why not?

Compute the elasticities of demand for and supply : Compute the elasticities of demand for and supply of broccoli at the market equilibrium, and interpret the meaning of these numbers.

User Account

All Pages