Fiscal Policy

Question 1

Fiscal policy

Answer 1

Changes the gov makes in spending or taxation to achieve particular economic goals

Question 2

expansionary fiscal policy

Answer 2

An increase in government spending or a reduction in taxes

Question 3

contractionary fiscal policy

Answer 3

A decrease in gov spending or an increase in taxes

Question 4

Changes the gov makes in spending or taxation to achieve particular economic goals

Answer 4

Fiscal policy

Question 5

An increase in government spending or a reduction in taxes

Answer 5

expansionary fiscal policy

Question 6

A decrease in gov spending or an increase in taxes

Answer 6

contractionary fiscal policy

Question 7

crowding out

Answer 7

The situation in which increases in government spending lead to reductions in private spending

Question 8

The situation in which increases in government spending lead to reductions in private spending

Answer 8

crowding out

Question 9

after-tax

Answer 9

The part of income that’s left over after taxes paid

Question 10

The part of income that’s left over after taxes paid

Answer 10

after-tax

Question 11

Laffer curve

Answer 11

The curve,e that shows that the relationship between tax rates and tax revenues. According to the Laffer curve, as tax rates rise from 0, tax revenues rise, reach a max at some point, and then fall with further increases in tax rates.

Question 12

The curve,e that shows that the relationship between tax rates and tax revenues.

Answer 12

Laffer curve

According to the Laffer curve, as tax rates rise from 0, tax revenues rise, reach a max at some point, and then fall with further increases in tax rates.