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What will happen if the government decreases spending and everything else remains constant?
Wiki User
∙ 10y ago
If the government decreases spending and everything else remains constant, there will be a decrease in aggregate demand, leading to a slowdown of economic growth or even leading to a contraction of the economy.
Wiki User
∙ 10y ago
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In an aggregate demand-aggregate supply diagram what will equal decreases in government spending and taxes do?
No effect. Spending will decrease Aggregate Demand, lower taxes will raise Aggregate Demand
How do changes in income affect the demand for a good?
Increases in income allow for more disposable income which increases spending and the demand for goods. Decreases in income conversely decreases disposable income which decreases spending.
Is GDP connected to government spending?
Yes, government spending is included in the expenditures calculations of GDP.
Why is it difficult for the federal government to increase or decrease spending?
Because two thirds of all government spending is on entitlements which the government connot easily alter. (by Solomon Zelman)
What influences government spending?
the macroeconomic objectives being pursued by the government will greatly influence government spending . a government aiming to reduce employment and promote economic growth is likely to pursue an expansionary fiscal policy , thus increasing government spending where as a government aiming to control inflation is likely to follow a contractions policy thus reducing its spending.
What is most likely to occur after the government increases taxes?
It reduces the money available for private sector spending.
In an aggregate demand-aggregate supply diagram what will equal decreases in government spending and taxes do?
No effect. Spending will decrease Aggregate Demand, lower taxes will raise Aggregate Demand
How do changes in income affect the demand for a good?
Increases in income allow for more disposable income which increases spending and the demand for goods. Decreases in income conversely decreases disposable income which decreases spending.
What branch of government has the power to increase or decrease taxes?
The Legislative Branch of government make law in taxation, that is, taxation regulations, taxations budget, taxations spending, taxations increases and decreases.
Is spending on IT projects constant thoughtout the project?
No, the spending on IT projects can vary from project to project and is not always constant throughout the project.
Is GDP connected to government spending?
Yes, government spending is included in the expenditures calculations of GDP.
When interests rates are low spending decreases true or false?
T
Why is it difficult for the federal government to increase or decrease spending?
Because two thirds of all government spending is on entitlements which the government connot easily alter. (by Solomon Zelman)
What influences government spending?
the macroeconomic objectives being pursued by the government will greatly influence government spending . a government aiming to reduce employment and promote economic growth is likely to pursue an expansionary fiscal policy , thus increasing government spending where as a government aiming to control inflation is likely to follow a contractions policy thus reducing its spending.
What is the approval of government spending?
The approval of government spending comes from Congress. It is referred to as the budget resolution or the deficit resolution.
Is the approval of government spending?
The approval of government spending comes from Congress. It is referred to as the budget resolution or the deficit resolution.
What is the appropriate measure of government s involvement in economic activity?
it is the share of government spending in total spending in the economy
