fiscal policy

Question 1

Fiscal policy

Answer 1

involves the use of gov spending tax and borrowing to influnce econ behaviour is a demand managment tool

Question 2

tax

Answer 2

direct taxes: income, nic, corpratiom

indirect: vat taxes on spendimg alr inpoarparted in the price

26% icnome tax

expansionerry
increases gdp decfeases tax and increase gov spendimhy,
helps speedn up econ,

contractionery: slows down ecom, deaese gsp incrtease tax decraese gov spending reduces inflation increases unemployknmeyt
neg mulitplier effcts as gov debt increases

provides incetive to work
discourae deand for dr=emrrit goods
influnce business decisojs in inesting
ensures thet ppl who benefit dfrom gov spenidng cotribute to tax aswell
raise suffient tax rev for gov spendi g
enables equal distribytion of wealth

Question 3

mpc

Answer 3

marginal prpensity to consume, proprtiom ofany extra income that is spent on consmp

Question 4

mps

Answer 4

marginal propensity to save