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 70 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
YES! Correct, THANKS for helping me on my review

pangili4

  • Member
  • Posts: 346
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

Eat fiber! A diet high in fiber can help lower cholesterol levels by as much as 10%.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

Did you know?

Bacteria have been found alive in a lake buried one half mile under ice in Antarctica.

Did you know?

Chronic necrotizing aspergillosis has a slowly progressive process that, unlike invasive aspergillosis, does not spread to other organ systems or the blood vessels. It most often affects middle-aged and elderly individuals, spreading to surrounding tissue in the lungs. The disease often does not respond to conventionally successful treatments, and requires individualized therapies in order to keep it from becoming life-threatening.

Did you know?

HIV testing reach is still limited. An estimated 40% of people with HIV (more than 14 million) remain undiagnosed and do not know their infection status.

The Major Divisions of the Visual Cortex of the Rhesus Monkey The Major Divisions of the Visual Cortex of the Rhesus Monkey
In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it. In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it.
Selected Biological Response Modifiers Selected Biological Response Modifiers
The Emergency Action Guide entry for styrene. Useful information includes emergency response ... The Emergency Action Guide entry for styrene. Useful information includes emergency response ...
Food policy can drive the food industry Food policy can drive the food industry
Major Structures of the Ear Major Structures of the Ear
Video: Inflammation

For a complete list of videos, visit our video library