he MPS in an economy is.4, government could shift the aggregate demand curve leftward by $50 billion at each price level by: Multiple Choice a)reducing government expenditures by $125 billion. b)reducing government expenditures by $20 billion. c)increasing taxes by $50 billion. d)increasing taxes by $250 billion.

Which of the following is NOT a tool of fiscal policy. O taxes O government spending Onterest rates none of the above Question 2 Assume the economy is in a deep recession. The appropriate fiscal policy response would be to: raise taxes and raise govemment expenditures cut taxes and cut govermment expenditures raise taxes and cut government expenditures O cut taxes and increase government expenditures D Question 3 Crowding out refers to the fact that: Tax cuts will cause inflation O Tax cuts may result in higher interest rates which will "crowd out" business investment spending O increased government spending will crowd out spending on imports none of the above

Suppose the tax multiplier in an economy is -8. If the government wants to lower total spending (TS) by $8000 what should they do to Taxes (T)? Group of answer choices a. they should increase taxes by $64000 b. they should decrease taxes by $64000 c. they should increase taxes by $1000 d. they should decrease taxes by $1000

4. Why does a reduction in taxes have a smaller multiplier effect than an increase in government spending of an equal amount?

Give typing answer with explanation and conclusion  Suppose that the typical Canadian spends 80 percent of their income. There is an income tax rate is 15% per period. If the government wanted to see the effect of a tax cut of $50 billion, what would be the tax multiplier that they would have to use.

2.   Why is the tax multiplier smaller than the government spending multiplier?

consumers increased consumption by a relatively small amount in 2008 and 2009 because thet believe the tax cuts temporary. true or false

What is true about the balanced budget​ multiplier?   A. The balanced budget multiplier is positive because an increase in government expenditure increases disposable income.   B. When both government expenditure and taxes decrease by​ $1, aggregate demand decreases.   C. The balanced budget multiplier is equal to zero.   D. The balanced budget multiplier is the magnification effect on aggregate demand of a simultaneous increase in aggregate demand and an equal decrease in taxes.

7. Algebraically derive the government spending and tax multiplier for the case in which tax revenues depend on income level. Verbally explain what you do in each step of the derivation.

Suppose the tax multiplier in an economy is -3. How will total spending (TS) change when taxes (T) decrease by $600? Group of answer choices a. TS will increase by $1800 b. TS will decrease by $1800 c. TS will increase by $200 d. TS will decrease by $200