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A: The fiscal policy is the U.S. government’s use of taxing

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Gabriela Louise

on 11 August 2014

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Transcript of A: The fiscal policy is the U.S. government’s use of taxing

Uncle Sam's Toolbox
Should the government create a law mandating a balanced federal budget? Support your position with evidence from the lesson.
A: Federal budget is a plan or record of income and expenses each year. By knowing that small bit of information,yes do I think the government should create a law mandating a balanced federal budget. The government can always use an extra bit of organization.
How might your efforts to balance the budget conflict with efforts to decrease unemployment, if at all?
What are the benefits and opportunity costs of the changes you propose? Consider the impact on economic growth, price stability, and unemployment.
Compare and contrast fiscal and monetary policy.  How are they alike and how do they differ?
Define fiscal policy.  Include the goals and tools of fiscal policy and the entity that controls it.
Fiscal policy is the use of government revenue collection and expenditure to influence the economy, or else it involves the government changing the levels of taxation and government spending in order to influence aggregate demand and the level of economic activity.
Does this create a budget surplus or deficit?  Explain.
Seeing that the government is bring in more than what they are spending, It creates a surplus.
Does this create a budget surplus or deficit?  Explain.
When the government is spending more than what is bring brought back, then it creates a deficit.
What are the benefits and opportunity costs of the changes you propose? Consider the impact on economic growth, price stability, and unemployment.
Fiscal policy
Monetary policy
Fiscal policy is the use of government expenditure and revenue collection to influence the economy
Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest to attain a set of objectives oriented towards the growth and stability of the economy.
Manipulating the level of aggregate demand in the economy to achieve economic objectives of price stability, full employment, and economic growth.
Manipulating the supply of money to influence outcomes like economic growth, inflation, exchange rates with other currencies and unemployment.
Central Bank (e.g. U.S. Federal Reserve or European Central Bank)
Government (e.g. U.S. Congress, Treasury Secretary)
Interest rates; reserve requirements; currency peg; discount window; quantitative easing; open market operations; signalling
Taxes; amount of government spending
Government
Money
Scenario 1: The government is currently spending three billion, one hundred million on programs and brings in three billion, five hundred million through taxation.
As a member of Congress, what changes would you suggest to fiscal policy to balance the budget?  Explain at least two ways you would use the tools of fiscal policy to balance the budget by recommending an "increase" or "decrease" to each tool in your explanation.
Fiscal policy deal with government taxing and spending. If they decrease their spending, the budget will be balanced
As a member of Congress, what changes would you suggest to fiscal policy to balance the budget?  Explain at least two ways you would use the tools of fiscal policy to balance the budget by recommending an "increase" or "decrease" to each tool in your explanation.
There is no cost, but the benefit would be that if the budget is balanced, there will be more price stability.
Well my focus wasn't on decreasing unemployment. It was more to try and balance the budget of the government and to decrease the spending.
Scenario 2: The government is currently spending three billion, seven hundred million on programs and brings in two billion, nine hundred million through taxation.  In addition, the nation has experienced a period of rising unemployment.
Scenario 3: The nation is currently experiencing a period of rising prices.  Inflation is making consumer goods increasingly difficult to afford as wages have remained constant.
As a member of Congress, what changes would you suggest to fiscal policy to balance the budget and indirectly address inflation? Suggest at least two specific changes to revenue and expenditures.
The changes I would suggest to fiscal policy to balance the budget and indirectly address inflation would be to reduce the government spending. But you could also increase taxes.
What are the benefits and opportunity costs of the changes you propose? Consider the impact on economic growth, price stability, and unemployment.
There is no benefit but the cost would be an increase in unemployment.
Are the proposed policies contractionary or expansionary? Explain.
A contractionary policy is a kind of policy which lays emphasis on reduction in the level of money supply for a lesser spending and investment thereafter so as to slow down an economy. A Expansionary policy is A macroeconomic policy that seeks to expand the money supply to encourage economic growth or combat inflation (price increases). One form of expansionary policy is fiscal policy, which comes in the form of tax cuts, rebates and increased government spending. Expansionary policies can also come from central banks, which focus on increasing the money supply in the economy. Knowing that, It would be Contractionary policy.
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