Question

During economic expansions: outlays increase and tax revenue falls. outlays increase and tax revenue increases. outlays...

During economic expansions:

outlays increase and tax revenue falls.

outlays increase and tax revenue increases.

outlays decrease and tax revenue increases.

outlays decrease and tax revenue falls.

outlays and tax revenue stay the same.

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Option C.

  • Economic expansion refers to a situation in which the ecomomy is experiencing growth in real GDP and has become Economically and productively efficient.
  • When Economy is experiencing a boom or expansion, the government imposes higher taxes on goods and services which decreases the level of spending or outlays on various goods and services due to the decline in consumption demands.
  • But the economic expansion provides Incentives to the government to earn more revenues from taxes they impose on various goods and services.
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
If the government lowers tax rates and tax revenue falls by $100 million, we can expect...
If the government lowers tax rates and tax revenue falls by $100 million, we can expect consumption spending to ________ and equilibrium output to ________. Answers: increase; increase by $100 million increase; increase by less than $100 million decrease; decrease by more than $100 million decrease; decrease by $100 million Correct option: increase; increase by more than $100 million For the second part of the question, why will output increase by more than $100 million?
Risk premiums on corporate bonds are usually anticyclical; that is, they decrease during cycle expansions and...
Risk premiums on corporate bonds are usually anticyclical; that is, they decrease during cycle expansions and increase during recessions. Why is this so?
3. During booms, capacity utilisation can be at high levels. Consequently, fiscal expansions during an economic...
3. During booms, capacity utilisation can be at high levels. Consequently, fiscal expansions during an economic boom can crowd out private spending, particularly investment. Explain. What does this imply about the size of the government multiplier during an economic boom?
As output increases, marginal revenue_________ (decrease,increase, remains constant) but marginal cost increases. If marginal revenue exceeds...
As output increases, marginal revenue_________ (decrease,increase, remains constant) but marginal cost increases. If marginal revenue exceeds marginal cost (if MR>MC),__________ (the extra revenue from selling one more unit exceeds the extra cost incurred to produce it, the extra revenue from selling one more unit equals the extra cost incurred to produce it, the extra cost incurred to produce it exceeds the extra revenue from selling one more unit). In this case, Economic profit increases if output increases. The options are...
Risk premiums on corporate bonds are usually countercyclical; that is, they decrease during business cycle expansions...
Risk premiums on corporate bonds are usually countercyclical; that is, they decrease during business cycle expansions and increase during recessions. Why is this so?
Considering a demand curve if the price of a good falls then marginal utility will Select...
Considering a demand curve if the price of a good falls then marginal utility will Select one: a. increase b. decrease c. remain the same d. may increase, decrease or stay the same
Question 9 (1 point) The federal government Question 9 options: runs a deficit when tax revenues...
Question 9 (1 point) The federal government Question 9 options: runs a deficit when tax revenues are greater than government outlays runs a surplus when tax revenues are smaller than government purchases runs a surplus when tax revenues are greater than government outlays runs a surplus when tax revenues are smaller than government outlays Question 10 (1 point) If equilibrium RGDP is $12000 billion and full employment GDP is $10000 billion, the economy is in____and a(n)____would move the economy to...
Suppose that the economy is in equilibrium. If the supply of labor increases, then A.Output will...
Suppose that the economy is in equilibrium. If the supply of labor increases, then A.Output will increase, the real rental price of capital will stay the same and the real wage rate will increase B.Output will increase, the real rental price of capital will increase and the real wage rate will decrease. C.Output will stay the same, the real rental price of capital will stay the same and the real wage rate will decrease. D.Output will stay the same, the...
An increase in taxes or a decrease in spending during an economic expansion can (a) increase...
An increase in taxes or a decrease in spending during an economic expansion can (a) increase the budget deficit but pay off some of the government debt. (b) work to decrease the budget deficit and pay off some of the government debt. (C)work to decrease the budget deficit but will not pay off any of the government debt. (E) increase the budget deficit and increase the size of the government debt. (f) work to decrease the budget deficit and increase...
When the economy is in equilibrium if the supply of labor increases then what will happen...
When the economy is in equilibrium if the supply of labor increases then what will happen to the output, the rental price of capital and the real wage rate? Will they increase decrease or stay the same? If the government increases expenditures what happens to equilibrium level of output and the real wage rate? Do they increase, decrease or stay the same?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT