Loading...

Messages

Proposals

Stuck in your homework and missing deadline? Get urgent help in $10/Page with 24 hours deadline

Get Urgent Writing Help In Your Essays, Assignments, Homeworks, Dissertation, Thesis Or Coursework & Achieve A+ Grades.

Privacy Guaranteed - 100% Plagiarism Free Writing - Free Turnitin Report - Professional And Experienced Writers - 24/7 Online Support

3 lags of fiscal policy

21/10/2021 Client: muhammad11 Deadline: 2 Day

Reword The Paper

3. Explain how built-in (or automatic) stabilizers work. What are the differences between proportional, progressive, and regressive tax systems as they relate to an economy’s built-in stability?

Built in stabilizers increase the government’s budget deficit during a recession and increases its budget surplus during inflation without requiring explicit action by policymakers. When an economy is growing and GDP is rising, tax receipts are high because of the progressive tax system. Personal income tax, corporate tax, sales taxes and all types of taxes decline during recession. This is an automatic tax cut that helps in time of recession. If households still had to pay the same level of taxes during the recession, the economic fluctuation would be so much worse, that type is proportional tax. The last type is regressive, this is when the average tax rate decreases as the taxpayer’s income increases and increases as the taxpayer’s as the taxpayer’s income decreases.

4. Briefly state and evaluate the problem of time lags in enacting and applying fiscal policy. How might “politics” complicate fiscal policy? How might expectations of a near-term policy reversal weaken fiscal policy based on changes in tax rates? What is the crowdingout effect and why might it be relevant to fiscal policy?

A time lag refers to the time it takes for a policy to take effect- the time between a policy measure is announced and its effects are visible. When this lag is large the government may not make a sound decision. It may take a decision that yields quicker results which it can show off to voters and get back into power. This decision maybe suboptimal for the economy, but optimal for the political party. Expectations about future policy reversals keeping politics in mind can dent the effect of any announced policy. if it is expected that tax rates will be lowered in future due to political considerations of winning an election, then a current policy of higher tax rates is not effective, making the fiscal policy weak.

Crowding out refers to the dampening of the effect of a rise in government expenditures on GDP. G rises to raise GDP, but the simultaneous rise in interest rates cause a fall in investment. The later reduces GDP. The overall effect of a rise in G is therefore dampened/ muted as it gets crowded out by rising interest rates.

7. Why did the budget surpluses in 2000 and 2001 give way to a series of budget deficits beginning in 2002? Why did those deficits increase substantially beginning in 2008?

The budget surplus story was due to the stock bubble, not tax cuts and budget restraint. Bubbles are not sustainable, by definition. The stock bubble began to burst in 2000. By the summer of 2002 stocks had fallen to roughly half of their peak values destroying $10 trillion in wealth. This gave us a recession which, although officially short and mild, led to the longest period without net job creation since the Great Depression (until the current downturn). The ending of this bubble was the biggest factor turning the surplus into a deficit. Also previous administration tax cuts were very much secondary in this picture, as were wars and the Medicare drug plan. The end of the stock bubble was the end of the budget surpluses.

8. Distinguish between the total U.S. debt and the debt held by the public? Why is the debt as percentage of GDP more relevant than the total debt? Contrast the effects of paying off an internally held debt and paying off an externally held debt.

The total U.S. debt represents the total amount of money the Federal government owes to the owners of government securities. However, only a portion of that (58 percent in 2004) is held by the public; the remaining 42 percent is held by the Federal government – the government owes the money to itself. Debt as a percentage of GDP is more relevant because it is a better measure of an economy’s, or government’s ability to manage that debt. It is analogous to an individual household: the level of mortgage and other debt is only a problem if the household does not have sufficient income (GDP) to keep up with monthly payments. A $10,000 debt is a problem for someone with no income; it is not a significant burden on someone earning $100,000 per year. Paying off internally held debt is like the left hand paying the right hand; dollars are redistributed, but there is no domestic loss of wealth. Paying off externally held debt represents an outflow of wealth from the country. Note that this isn’t necessarily bad if the external debt was incurred to bring in goods or assets that facilitate domestic economic growth or serve other important priorities.

Homework is Completed By:

Writer Writer Name Amount Client Comments & Rating
Instant Homework Helper

ONLINE

Instant Homework Helper

$36

She helped me in last minute in a very reasonable price. She is a lifesaver, I got A+ grade in my homework, I will surely hire her again for my next assignments, Thumbs Up!

Order & Get This Solution Within 3 Hours in $25/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 3 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

Order & Get This Solution Within 6 Hours in $20/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 6 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

Order & Get This Solution Within 12 Hours in $15/Page

Custom Original Solution And Get A+ Grades

  • 100% Plagiarism Free
  • Proper APA/MLA/Harvard Referencing
  • Delivery in 12 Hours After Placing Order
  • Free Turnitin Report
  • Unlimited Revisions
  • Privacy Guaranteed

6 writers have sent their proposals to do this homework:

Quick N Quality
Top Quality Assignments
Fatimah Syeda
Math Exam Success
Calculation Guru
Homework Guru
Writer Writer Name Offer Chat
Quick N Quality

ONLINE

Quick N Quality

I am a PhD writer with 10 years of experience. I will be delivering high-quality, plagiarism-free work to you in the minimum amount of time. Waiting for your message.

$26 Chat With Writer
Top Quality Assignments

ONLINE

Top Quality Assignments

I can assist you in plagiarism free writing as I have already done several related projects of writing. I have a master qualification with 5 years’ experience in; Essay Writing, Case Study Writing, Report Writing.

$38 Chat With Writer
Fatimah Syeda

ONLINE

Fatimah Syeda

I am an academic and research writer with having an MBA degree in business and finance. I have written many business reports on several topics and am well aware of all academic referencing styles.

$32 Chat With Writer
Math Exam Success

ONLINE

Math Exam Success

I have read your project details and I can provide you QUALITY WORK within your given timeline and budget.

$28 Chat With Writer
Calculation Guru

ONLINE

Calculation Guru

As per my knowledge I can assist you in writing a perfect Planning, Marketing Research, Business Pitches, Business Proposals, Business Feasibility Reports and Content within your given deadline and budget.

$26 Chat With Writer
Homework Guru

ONLINE

Homework Guru

I am a professional and experienced writer and I have written research reports, proposals, essays, thesis and dissertations on a variety of topics.

$29 Chat With Writer

Let our expert academic writers to help you in achieving a+ grades in your homework, assignment, quiz or exam.

Similar Homework Questions

Assignment - Walt disney world swot analysis - Exploratory descriptive explanatory or evaluative research - ECE 332 WK 3 ASSIGNMENT 1 - Discussion(TM) - Fela kuti music is the weapon - The Professional and Ethical Demeanor I Will Display - Wee5 discussion question 2 - Penn foster information literacy exam answers - Table 3 two point discrimination test results - Theme of suffering in sonny's blues - Babylonian numbers 1 1000 - Gate turnaround at southwest airlines - Which civilization most profoundly affected the development of mayan society? - Arrest process flow chart - Usq associate degree electrical engineering handbook - Nurses as knowledge workers definition - North staffs pigeon federation - D5 other work related expenses - Walter elias disney miller - Two perspective drawing city - Describe venus of willendorf - 20 lines poem in english - Social media celebrity - Formulas and oxidation numbers lab answers - Princples of economics week 9 dis - Ethical issues - Walt disney swot analysis 2019 - Dmaic examples in restaurants - Does bianca die in othello - Boolean operators and truncation - Ut austin turing scholars college confidential - Module 10 Pre-Lab Assignment - Nickelodeon h2o power blimp commercial - Httprecipes login - Crow foot notation microsoft word - Persuasive Essay (Compensation Management) - 1/184 parer road airport west - Oliver twist chapter 14 summary - Political thought - Acc chem res 2012 - Cloud Computing - HW - Allstate bringing mayhem to the auto insurance advertising wars - Squander - Fuxing huiyu real estate - Describe the relationship between mandela and pienaar - Shavepate definition - Alive o songs confirmation - Dulux white powder coat - Molar mass of blue dye 1 - High crags primary school bradford - Week-8 assignment cpm - Northern foundation school scores - Brisbane state high entrance test - How to figure out percent yield - Emirates id sdk toolkit download - Writing assignment 700 words- Please follow the Instructions - William dawes midnight ride - James baldwin sonny's blues pdf - Penn foster written exam example - Are web filters at your school too restrictive essay - Barbara ehrenreich serving in florida questions - Aubin grove train station - Mass percent of nahco3 in an alka seltzer tablet - Grade 7 reading list - Yellow card application form qld - Saving sourdi pdf - Enron corporation case study answers - Case 1 2 nestle the infant formula controversy answers - Iso technical drawing standards pdf - Zane waitley cause of death - Difference between job description and job specification ppt - Corrective action vs disciplinary action - Write answer without negative exponents - The book of micah presents a divine lawsuit - The thrill of the grass sparknotes - Fiberglass chemical resistance guide - 4 1 balun design - Cwa cauliflower pickle recipe - Comprehensive problem 3 kornett company balance sheet - Jack wills swot - Mathematical methods formula sheet - How your computer works - Nova inside the megastorm worksheet - Chipotle strategy analysis - Admn - Armstrong cheese factory ontario - Icd 10 code for cva thrombosis of basilar artery - If You Are Looking Health Care Dissertation Writing Service - John q movie character analysis - Ground grid integrity testing - Oscar pistorius top speed - Coprinus mushroom slide labeled - A pistol that fires a signal flare - Hertfordshire county council training courses - The sculptor of the panel the story of jacob and esau, and donatello’s teacher, is: - Daniel goleman introduces emotional intelligence - Bta16 600b application notes - How many died on hacksaw ridge