Exam (elaborations)
loma 308 module.1 Questions and Answers Graded A_
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Exam of 2 pages for the course LOMA at LOMA (loma 308 module.1)
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By: modiddle • 4 months ago
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loma 308 module.1fiscal policy - answer direct the use of government spending and taxation to change
aggregate demand : indicated by: level of spending in the economy
a country's leaders and primary legislative bodies are are responsible for creating and
enforcing fiscal policies
fiscal policies are either expansionary or contractionary
expansionary fiscal policy - answer designed to increase aggregate demand as a
way to increase the pace of the economy
used during periods of recession
involves higher government spending lower taxes or both
lower taxes increases consumer spending by increasing disposable income
expansionary danger - answer danger of expansionary fiscal policy is that unless
government spending is controlled it could exceed revenues and lead to budget deficit
if budget deficit already exists an expansionary policy ca intensify it
contractionary fiscal policy - answer designed to fight inflation by decreasing
aggregate demand and slowing the pace of the economy
government actions involve increasing taxes decreasing spending or both
contractual policy 2if controlled it can help reduce a budget deficit or can lead to a
budget surplus
if a surplus already exists a contractual fiscal policy can increase the amt. of surplus. -
answer
budget surplus - answer A budget in which government revenues exceed
government expenditures in a given time period
budget deficit - answer A budget in which government expenditures exceed
government revenues in a given time period
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