Explain why congress only sent stimulus checks

Reference no: EM132874494

Microeconomics

Congress passed the CARES Act to provide an economic safety net during the Covid-19 pandemic shutdown. The CARES Act included stimulus checks that were sent to some households. Households with individuals making up to $75,000 received a $1,200 check and households with married couples making up to $150,000 received a $2,400 check. Think about how the savings rate varies with household income and the utility of savings versus spending when answering the questions below.

Question 1. Explain why Congress only sent stimulus checks to households up to a certain income level.

Question 2. Does this program make sense given the fact that there is a severe economic downturn? Why or Why not?

Question 3. Does the particular income limit imposed make sense? Should it be higher, lower, or should there be no limit. Provide an explanation for your answer.

Reference no: EM132874494

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