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Economics: Concepts and Choices

Holt Mcdougal

Chapter 15

Using Fiscal Policy - all with Video Answers

Educators


Section 1

What Is Fiscal Policy?

02:41

Problem 1

Use each of the three terms below in a sentence that illustrates the meaning of the term.
a. expansionary fiscal policy
b. discretionary fiscal policy
c. rational expectations theory

David Gagnon
David Gagnon
Numerade Educator
03:23

Problem 2

What are the two basic goals of fiscal policy?

David Gagnon
David Gagnon
Numerade Educator
03:34

Problem 3

How do expansionary fiscal policy and contractionary fiscal policy use the same fiscal policy tools in different ways?

David Gagnon
David Gagnon
Numerade Educator
03:17

Problem 4

What is the difference between discretionary fiscal policy and automatic stabilizers?

David Gagnon
David Gagnon
Numerade Educator
02:31

Problem 5

What is the role of the Council of Economic Advisers?

David Gagnon
David Gagnon
Numerade Educator
05:20

Problem 6

What are the limitations of fiscal policy? Refer to your completed cluster diagram.

David Gagnon
David Gagnon
Numerade Educator
03:15

Problem 7

Between 2001 and 2004 , Congress passed a series of tax cuts and increased government spending. Do these actions reflect expansionary or contractionary fiscal policy? Explain your answer.

David Gagnon
David Gagnon
Numerade Educator
02:39

Problem 8

Agricultural price supports provide farmers with government subsidies when market prices of certain crops are low. What kind of fiscal policy is at work in this situation and how does it work?

David Gagnon
David Gagnon
Numerade Educator
03:43

Problem 9

Federal government officials want to prevent a slowing economy from going into recession. They debate whether to increase spending on new public transit systems or decrease individual and corporate income tax rates.
a. How would an understanding of policy lags help them decide which government action would be most effective?
b. What other issues might affect their decision?

David Gagnon
David Gagnon
Numerade Educator
02:00

Problem 10

Make a copy of Figure 15.4 on page 451 and label the part of line $F$ that might represent expansionary fiscal policy and the part that might represent contractionary fiscal policy.

David Gagnon
David Gagnon
Numerade Educator