Monetary, Fiscal And Incomes Policy, And Inflation

A. reserve, unemployment
B. money supply, interest rate
C. taxes, exchange rate
D. stock price, minimum wage

A. are central banks
B. are branches of commercial banks
C. use fiscal policy to influence GDP
D. loan money to most of LDC commercial banks

A. progressive
B. regressive
C. value added taxes (VAT)
D. excise taxes

I- tax holidays
II- accelerated depreciation
III- import duty relief
IV- lower tax rates for reinvested business profits

I- consumer price index (CPI)
II- GDP deflator
III- current account
IV- depreciation

I- an increase in aggregate spending will eliminate the recession
II- a decrease in aggregate spending will reduce inflation
III- government faces contradictory goals
IV- the central bank decease money supply to reduce inflation

A. ratchet inflation
B. inflationary expectations
C. import substitution
D. demand pull inflation

A. demand for government spending on public goods goes due to lack of financial backup through tax collection
B. consumer business and government demand for goods and services in excess of an economy’s capacity to produce
C. a shortage of demand for goods and services in excess of supply during depression
D. demand for public goods is greater than demand for consumer goods

A. demand pull inflation tax elasticity
B. interest rates, financial liberalization
C. interest rates, tax rates
D. tax rates, government spending

A. incomes policy
B. Moral hazard
C. Wagner’s law
D. Fiscal policy