Reading 19: Monetary and Fiscal Policy

Question 1

Money Creation

19.1

Monetary and Fiscal Policy

Answer 1

Question 2

Quantity Equation of Exchange

19.2

Monetary and Fiscal Policy

Answer 2

Question 3

The Fisher Effect

19.3

Monetary and Fiscal Policy

Answer 3

Question 4

Neutral Rate of Interest

19.4

Monetary and Fiscal Policy

Answer 4

Question 5

Net Impact of Government Sector on Demand

19.5

Monetary and Fiscal Policy

Answer 5

Question 6

Disposable Income (Relative to Net Taxes)

19.6

Monetary and Fiscal Policy

Answer 6

t is the net tax rate.

Net taxes (NT; taxes less transfers) reduce disposable income (YD) available to individuals relative to national income or output (Y)