This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If inflation is a major issue in the economy, what would be the correct fiscal policy response from ... (Read 62 times)

javeds

  • Hero Member
  • *****
  • Posts: 570
on: Jun 30, 2018
If inflation is a major issue in the economy, what would be the correct fiscal policy response from an economic perspective? Why would members of Congress be unlikely to support such actions?

Question 2

In order to use inflation targeting, a central bank must:
 a. be independent of fiscal policy.
  b. be dependent on fiscal policy.
  c. focus on money supply.
  d. focus on unemployment.
  e. focus on stable exchange rates.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ebe

  • Sr. Member
  • ****
  • Posts: 320
Reply #1 on: Jun 30, 2018
Answer to Question 1

If inflation is the major issue, the correct fiscal policy response would be to increase taxes, decrease government purchases, and/or decrease transfer payments in order to reduce aggregate demand putting downward pressure on prices. However, these actions would not be popular with voters making elected officials unlikely to support them.

Answer to Question 2

a


javeds

  • Member
  • Posts: 570
Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)

triiciiaa

  • Member
  • Posts: 349
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

Serum cholesterol testing in adults is recommended every 1 to 5 years. People with diabetes and a family history of high cholesterol should be tested even more frequently.

Did you know?

The oldest recorded age was 122. Madame Jeanne Calment was born in France in 1875 and died in 1997. She was a vegetarian and loved olive oil, port wine, and chocolate.

Did you know?

Symptoms of kidney problems include a loss of appetite, back pain (which may be sudden and intense), chills, abdominal pain, fluid retention, nausea, the urge to urinate, vomiting, and fever.

Did you know?

More than one-third of adult Americans are obese. Diseases that kill the largest number of people annually, such as heart disease, cancer, diabetes, stroke, and hypertension, can be attributed to diet.

Did you know?

Many medications that are used to treat infertility are injected subcutaneously. This is easy to do using the anterior abdomen as the site of injection but avoiding the area directly around the belly button.

Major types of microbial cell aggregations found in phylum Cyanobacteria. Major types of microbial cell aggregations found in phylum Cyanobacteria.
Funny Maths Response Funny Maths Response
This lithograph by Currier and Ives gives an erroneous impression of the “battle.” Major Robert Ande This lithograph by Currier and Ives gives an erroneous impression of the “battle.” Major Robert Ande
Anterior view of major muscles. Anterior view of major muscles.
The major external features of a neuron. The major external features of a neuron.
The clonal selection theory of the adaptive immune response The clonal selection theory of the adaptive immune response
Video: Egg and Sperm Formations in Animals Animation

For a complete list of videos, visit our video library