Why is functional finance difficult to implement

Assignment Help Business Economics
Reference no: EM131101245

Why is functional finance difficult to implement?

1. Financing the deficit often has offsetting effects, and the government doesn’t always know how its policies will affect the economy.

2. Potential output is not a known quantity, and enacting spending and taxing policies is time consuming.

3. Government debt can affect private spending, and taxing and spending can negatively affect other government goals. 4.

It is unknown whether the Ricardian equivalence theorem is true.

5. The government cannot function without the popular vote, making policy difficult.

Reference no: EM131101245

Questions Cloud

Spend on pumpkin scones and triple vent sugar free : Draw the budget line for the following situation. You have an income of $30 to spend on pumpkin scones and triple vent sugar free, non fat, no foam, extra caramel, with whip, caramel The are $5 each and each scone is $3, but the store is running a pr..
Optimize production by employing variable amount : The production function of a restaurant includes items such as labor (i.e., cooks, waiters, a manager), capital (i.e., ovens, counters, tables, chairs, and a building), and land. In the short run, the owner of the restaurant will optimize production ..
An increase in personal income tax on interest income will : An increase in the personal income tax on interest income will
Demand function for profit maximizing monopolists good : Suppose the demand function for a profit maximizing monopolists good is P = 160 - 0.5Q, its total cost function is TC = 20 + 10Q + 0.3Q2, and its marginal cost function is MC = 10 + 0.6Q. If the firm uses a uniform pricing strategy, then rounded to t..
Why is functional finance difficult to implement : Why is functional finance difficult to implement?
Educational system is just getting better at spotting : Why do you think students with disabilities are targeted for bullying by their peers at a higher rate than non-disabled students? Do you think incidents of bullying are increasing, or that our educational system is just getting better at spotting and..
Starting from long-run equilibrium : Starting from long-run equilibrium, use the basic aggregate demand and aggregate supply diagram to show what happens in both the long run and the short run when there is a decline in wealth.
Experiences of special education law : What are your thoughts and experiences of special education law or children with disabilities in the education system in America? What do you think should be done to support students with disabilities in light of shrinking school budgets?
Statement about discrimination i the labor market : Which of the following is not a true statement about discrimination I the US labor market

Reviews

Write a Review

Business Economics Questions & Answers

  Monopolist with a straight-line demand curve finds

A monopolist with a straight-line demand curve finds that it can sell two units at $12 each or 12 units at $2 each. Its marginal cost is constant at $3 per unit. Given the demand curve, draw the MR, and MC curves for this monopolist.

  The ratio of capital accounts to total assists

"The ratio of capital accounts to total assists is only one of many factors that indicate the financial condition of a commercial bank." Evaluate this statement

  That ceo want to cut back on production of the fishing

Ralph Sampson, the company's CEO, want to cut back on production of the fishing anchor so that the company can make more yacht anchors.

  A current account balance-of-payments surplus implies an

A current account balance-of-payments surplus implies an

  Taxes and transfers are fixed

Suppose that taxes and transfers are fixed, so that a change in the government’s spending is equivalent to a change in its deficit. The multiplier is three. For each increase in the deficit of 100, interest rates rise by one percentage point. When th..

  Exchange rate fixed will have devaluation

A country that attempts to keep its exchange rate fixed will have a “devaluation” of its currency (or exchange rate) if persistent balance of payments deficits cause it to amass dangerous amounts of foreign exchange reserves. Would you please explain..

  What is the value of the annual coupon payment

A 10 year coupon bond with face value $1,000 and yield to maturity i = 0.05 sells for a price of $1,386.08. What is the value of the annual coupon payment? Round your answer to the nearest cent.

  Currency into her checking account

A consumer deposits of $1,000 in currency into her checking account. The bank sets aside $200 aside as required reserves (i.e. assume a 20% minimum reserve requirement), and then makes a loan of $800 to a new borrower.

  Illustrate the perfectly competitive market for root beer

Illustrate the perfectly competitive market for root beer in chaseystan has achieved long run equilibrium.

  Elucidate how asymmetric information about a hidden action

Elucidate how asymmetric information about a hidden action or a hidden action or a hidden characteristic can lead to moral hazard or adverse selection.

  Low voter turnout is not an indicator of trouble

Which of the following arguments do you support? Why? low voter turnout is not an indicator of trouble, as it signifies satisfaction with the status quo

  What would be the annual percentage rate

What would the annual percentage rate be if the city plans to make an interest payment of $2 million - The City of Phoenix plans to buy five additional mass transit cars for $15 million, and pay off its loan in 10 years.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd