Manipulation of government spending and taxes to stabilize domestic output, employment, and the price level.
What is Fiscal Policy?
100
The rise in the general level of prices in an economy.
What is inflation?
100
The size of the Federal government's budgetary surplus or deficit when the economy is operating at full employment.
What is the cyclically-adjusted budget?
100
This is one problem of discretionary fiscal policy.
What is recognition lag (or administrative lag or operational lag)?
100
A tax whos average tax rate remains constant as the taxpayer's income increases or decreases.
What is a proportional tax?
200
This is the amount by which government expenditures exceed revenues during a particular year.
What is budget deficit?
200
A tax rate increase is an appropriate fiscal policy for severe ____________-________ inflation.
What is a demand-pull?
200
These adjustments in the economy require no legislative action by Congress to be made effective.
What is built-in or automatic stabilizers?
200
This is caused by the Federal government's increased borrowing to finance budget deficits and refinance debt.
What is the crowding-out effect?
200
A tax whose average tax rate increases as the taxpayer's income increases and decreases as the taypayers' income decreases.
What is a progressive tax?
300
Congress passes legislation to cut taxes to counter the effects of a severe recession.
What is expansionary fiscal policy?
300
The two options the Federal government has which prevents it from going bankrupt with the large U.S. public debt.
What are refinancing and taxation?
300
When current tax revenues exceed current government expenditures and the economy is achieving full employment the cyclically-adjusted budget has this.
What is a surplus?
300
Discretionary fiscal policy has increasingly relied on tax changes rather than on changes in government spending as it's main tool because of this lag, particularly.
What is operational lag?
300
So called ______ - ___________ ____________ is one factor that could reduce the crowding-out effect.
What is public-private complementarities?
400
Intentional changes in taxes and government expenditures made by Congress to stabilize the economy.
What is discretionary fiscal policy?
400
Increased costs in production or distribution of goods and services create this type of inflation.
What is cost-push inflation?
400
The more ____________ the tax system, the greater the economy's built-in stability.
What is progressive?
400
Often, State and Local governments ___________ rather than correct recession or inflation.
What is worsen?
400
Suppose the government purposely changes the economy's cyclically-adjusted budget from a deficit of 3 percent of real GDP to a surplus of 1 percent of real GDP. The government is engaging in this.
What is contractionary fiscal policy?
500
An economist who recommends tax cuts during recession and reductions in government spending during inflation favors this.
What is a smaller government.
500
Inflation is often measured by this.
What is the consumer price index (CPI)?
500
Unemployment compensation and welfare payments are examples of this stablizer.
What is built-in or automatic?
500
The crowding-out effect is likely to be _________ of a problem when the economy is in a recession.
What is less?
500
When current government expenditures equal current tax revenues and the economy is achieving full employment, the cyclically-adjusted budget has this.