The Effect of State and Local Government Spending on GDP
What will be an ideal response?
While much of the debate about government spending in the United States focuses on the federal level, changes in government spending at state and local levels can also have a significant impact on the macroeconomy. The U.S. Bureau of Economic Analysis (BEA) has developed economic models that attempt to isolate the impact of state and local government spending on GDP (CHAPTER 10 PAGE 238)
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A model comparing savings and foreign exchange constraints to see which is binding for economic growth is known as a
(a) project appraisal. (b) two gap model. (c) computable general equilibrium. (d) trickle down model. (e) none of the above.
Many economists believe that tax cuts increase incentives to work and invest but current U.S. tax levels do not appear to be on the downward side of the Laffer curve
a. True b. False Indicate whether the statement is true or false
A tax on buyers decreases the quantity of the good sold in the market
a. True b. False Indicate whether the statement is true or false
A good example of a price floor is:
A. rent controls on apartments in major cities. B. general admission tickets to concerts. C. the minimum wage law. D. food stamp regulations.