In the Keynesian model, raising government purchases and lowering taxes have the same effects on output and

Question:

In the Keynesian model, raising government purchases and lowering taxes have the same effects on output and the composition of output in the long run. Do you agree with this statement? Explain your answer using the $A D-A S$ model.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Macroeconomics

ISBN: 9780134167398

9th Edition

Authors: Andrew B. Abel, Ben Bernanke, Dean Croushore

See More Books

Question Posted: Apr 30, 2024 01:01 AM

See More Questions

1. In the classical model, it is thought that the long-run: A. and short-run aggregate supply curves are both upward sloping. B. aggregate supply curve is vertical and the short-run aggregate supply...
: (i) What data structures are maintained by the page manager. (ii) What happens when a machine performs a read operation to a page. (iii) What happens when a machine performs a write operation to a...
Answer the following question. 1 - Conformity a. How does conformity to normative social influence differ from conformity to informational social influence? b. Explain how both normative and...
What is the wavelength of light if its frequency is 1.009 106 Hz?
What are the benefits of implementing systems and software using cloud computing?
Jason Wertz paid $50,000 for a franchise that entitled him to market Success software programs in the countries of the European Union. Wertz intended to sell individual franchises for the major...
True or False. All practical systems have damping.
Presented below is information related to Kienholz Company for its first month of operations. Identify the balances that appear in the accounts receivable subsidiary ledger and the accounts...
Brendon is a Carpenter by profession and has a successful business. Brendon was approached by Chris to build a double-story house. All the house plans were approved by the local Town Council and...
Consider the following Keynesian closed economy: a. What is the equation of the IS curve and LM curve? b. Suppose that the price level is fixed at 5 in the short run. What are the short-run...
The government plans to increase its government purchases by 2 million dollars every year, which will be financed by an increase in lump-sum taxes of 2 million dollars every year. Now the government...
In Theorem 3.37, prove that if p i = p j , then we cannot determine whether an error occurs in the ith or the jth component of the received vector. (Throughout this proof we denote by ai the ith...
Use the data in Table 1.11 to determine the 1991 cost in 2008 dollars of mailing a first-class letter. Is this value higher or lower than the actual $0.42 cost of mailing a letter in 2008? Date...
Terrific Town Houses Ltd is a large company registered in South Australia for the purpose of constructing blocks of home units and town houses. The company conducts its activities in all states. The...
Determine the mean and standard of the binomial distribution for the variable X in each of the following: a. N = 5 and = 0.10 b. N = 5 and = 0.50 c. N = 4 and = 0.75 d. N = 3 and = 0.45
Is the gender of a baby a random event? Factors such as drug use, occupation, and environment may have an impact on the sex of the baby a couple is likely to conceive. For example, it has been...
A regional airline carrier determined that the number of kilo meters travelled per airplane per year is normally distributed with a mean of 700 thousand kilo meters and a standard deviation of a 100...
A O.100-kg potato is tied to a string with length 2.50 m, and the other end of the string is tied to a rigid support. The potato is held straight out horizontally from the point of support, with the...
On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cashflows: ACCOUNT Land ACCOUNT NO. Balance Date Item Debit Credit Debit Credit...
Considering the challenges of inventory management that are mentioned in the article (e.g. difficulties balancing and synchronizing demand and supply, capacity problems), what would you suggest to...
https://www.coursehero.com/file/159764230/Leadership-Motivation-Teams-Diversity-Coach-McKeever-Unorthodox-Leadership-Lessons-from-the-Pool/ a.) Read the following case b.) Discuss and analyze the...
Based on the articles Negotiate in three dimensions, get all the interests right, control the negotiation before it begins and four key concepts your starting points, provide 15 tactics and...

In the Keynesian model, raising government purchases and lowering taxes have the same effects on output and

Question:

Step by Step Answer:

In the Keynesian model raising government purchases and lowering taxes are both expansionary fiscal policies aimed at increasing aggregate demand AD t...View the full answer

Macroeconomics

Students also viewed these Business questions