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Teacher professional development and classroom resources across the curriculum
To show that a key element of Keynes’s contribution is that, at least in theory, the government can fine-tune tax and spending policies to reduce the severity of business-cycle fluctuations.
Economist known as the leading proponent of 20th-century political liberalism, and a prolific author who produced four dozen books and more than a thousand articles, including the popular trilogy American Capitalism, The Affluent Society, and The New Industrial State.See full bio
Currently President of the American Action Forum and a Commissioner on the Congressionally-chartered Financial Crisis Inquiry Commission. Under President George W. Bush, he was Chief Economist for the Council of Economic Advisers and Director of the Congressional Budget Office.See full bio
Inflation is a sign that the aggregate demand curve is:
somewhere within the vertical range.NEXT QUESTION
The Council of Economic Advisers was established by the Employment Act of 1946 to:
help the president carry out the objectives of that Act.NEXT QUESTION
Economist Ruth B. feels that too much reliance on government intervention through fiscal policy is hazardous to our nation’s future economic health. “We’ve seen the automatic stabilizers work in the past,” she contends. “Why not let things take their course? Government spending is high enough right now to keep the economy functioning well without so much steering on our part. It may well do better without us.” Which of the following probably BEST describes the way today’s economists would view Ruth’s argument in this scenario?
It’s an approach that makes sense when things are generally functioning well, but economic stabilizers have limited impact. This option makes the most sense. The economic stabilizers do keep the economy functioning well, in many cases without government intervention (as the Eisenhower scenario illustrates), but they are limited. They can only do so much. When severe economic problems arise, more intervention is essential.NEXT QUESTION
Which of the following BEST explains why automatic stabilizers have more effect on our economy now than they did during the 1930s?
spending has increased dramatically since the 1930s.NEXT QUESTION
When President Kennedy took office in 1961, he inherited an economy marked by high unemployment. His advisers, led by Walter W. Heller, pushed hard for a tax cut to deal with the problem. Ultimately, after much consideration and deliberation, Kennedy agreed to the strategy, and the tax cut of 1964 became a reality just months after Kennedy’s assassination. Which of the following BEST describes the impact of the 1964 tax cut, as today’s analysts see it?
The impact was very slight, disappointing to those who had favored a government spending package in place of the tax cut.NEXT QUESTION
Since 1929, government expenditures have grown faster than total output. Which of the following has contributed LEAST to this rapid growth in govenrment spending?
Shifts in equilibrium NNP.RESTART QUIZ