Questions from Macroeconomics

Q: Given the Keynesian consumption function, how would a cut in income

Given the Keynesian consumption function, how would a cut in income tax rates affect consumption? Explain your answer.

Q: Look at the Keynesian consumption function: C = C0 + (

Look at the Keynesian consumption function: C = C0 + (MPC × Yd). What part of it relates to autonomous consumption? What part of it relates to induced consumption? Define autonomous consumption and in...

Q: Using the Keynesian consumption function, prove numerically that, as the

Using the Keynesian consumption function, prove numerically that, as the MPC rises, saving declines.

Q: Explain the multiplier process.

Explain the multiplier process.

Q: In the previous chapter you learned about the law of increasing opportunity

In the previous chapter you learned about the law of increasing opportunity costs. What does this law have to do with an upward-sloping supply curve?

Q: What is the difference between government expenditures and government purchases?

What is the difference between government expenditures and government purchases?

Q: According to Buchanan and Wagner, why is there a political bias

According to Buchanan and Wagner, why is there a political bias towards expansionary fiscal policy and not contractionary fiscal policy?

Q: Explain two ways crowding out may occur.

Explain two ways crowding out may occur.

Q: Why is crowding out an important issue in the debate over the

Why is crowding out an important issue in the debate over the use of fiscal policy?

Q: Some economists argue for the use of fiscal policy to solve economic

Some economists argue for the use of fiscal policy to solve economic problems; some argue against it. What are some of the arguments on both sides?