Transcript AP jeopardy schiller 11 and 12x

Jeopardy!
Taxes
Fiscal
Policy
Fiscal
Policy
Types
Irresponsible
Spending
Government
Spending
and
Investment
Alex
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Trabeconomics
An increase in taxes will
change aggregate demand in
which way?
Decrease
A tax that charges the poor a
larger percent of their income
than the rich may be
described as this.
Regressive tax
A tax which does not vary with
level of GDP
Fixed tax
A change in a fixed tax will
simply shift the
consumption function.
However, an increase in a
variable tax will affect the
consumption function in
what way?
Flatten
If MPC = .75, the tax rate is
20%, and you receive a
$1000 bonus at work, how
much will you spend?
$600
The government’s plan for
spending and taxation which
is designed to steer aggregate
demand in some
direction
Fiscal Policy
A feature of the economy that
reduces sensitivity to
shocks
Automatic stabilizer
If taxes and government
spending increase the exact
same amount ($200 Billion),
what will happen to GDP?
Increase by $200 Billion
In an economy with an income
tax, the multiplier is likely to be
________ than without the
tax.
Smaller
The multiplier for a change in
taxes is _______ the
multiplier for a change in
government spending
Smaller than
(Automatic/Discretionary):
Congress provides a one-time
tax rebate to all tax payers.
Discretionary
(Automatic/Discretionary): Tax
revenue increases as an
improving stock market leads
to increasing capital gains
Automatic
(Expansionary/Contractionary)
(Automatic/Discretionary):
Congress votes to build a new
interstate highway.
Expansionary, Discretionary
(Expansionary/Contractionary)
(Automatic/Discretionary):
Congress votes to create an
expanded unemployment
insurance program
Discretionary, Expansionary
(Expansionary/Contractionary)
(Automatic/Discretionary):
Congress cuts funding to the
National Teapot Museum, and
uses the funds saved to
increase transfer payments to
Snapple, Inc.
Contractionary, Discretionary
This occurs when expenditures
exceed revenue over a given
period of time.
Deficit
This is the sum of deficits over
time.
Debt
_______ describes a deficit the
government incurs at full
employment.
Structural deficit
When unemployment is high the
government’s actual deficit will
be _____ than the structural
deficit.
Higher
The group to which the federal
government owes the largest
portion of its debt.
The federal government.
Large deficits tend to lead to
higher/lower interest rates.
Higher
This describes the situation in
which higher government
spending leads to less (I).
Crowding out.
Low interest rates will lead the
production possibilities frontier
to do this in the future.
Shift right.
DAILY DOUBLE!
_______ results from increased
government spending when the
available supply of loanable
funds is high.
Crowding in
Assume the government runs a
structurally balanced budget. If
unemployment is high what will
resulting budget balance be?
Cyclical deficit
• Increased government
spending which limits
(I)/This duo scored a
big hit with their
album
“Speakerboxx/The
Love Below”
Crowding Outkast
• This rapper has starred
in the movies “The
Italian Job” and “The
Hitchhiker’s
Guide…”/A
government runs this
when spending
exceeds revenue.
Mos Deficit
The government’s plan to steer
the economy by manipulating
spending and taxes / He’s a
starting pitcher for the Yankees
Fiscal Poli-C.C. Sabathia
A one-time fiscal policy may be described as
this / Chris Brown was arrested for an alleged
altercation with his then girlfriend, this
performer
Discretiona-Rihanna
DAILY DOUBLE!
A deficit that
occurs at full
employment /
Orson Welles’
most famous
film – number
one on AFI’s
100 greatest
movies of all
time.
Structural Defi-Citizen Kane