Log in
HomeStudy Guides420,000US230,000

EC 202 Study Guide - Final Guide: Money Multiplier, Regressive Tax, Fiscal Multiplier

122 views6 pages
ceruleanhyena747
19 Mar 2018
School
University of Oregon
Department
Economics
Course
EC 202
Professor
Urbancic

For unlimited access to Study Guides, a Grade+ subscription is required.

Document Summary

Positive change increase to sras 2 decrease to sras 3 decrease to sras 3. Negative change decrease to sras 3 increase to sras 2 increase to sras 2. Y returns to original level u returns to original level. Y returns to original level ur returns to original level. Causes of inflation: demand-pull inflation = increase in aggregate demand, cost-push (supply side) inflation = increase in costs, stagflation = output falling at same time prices increasing. Categorizing taxes by percentage of income: proportional (flat) tax = burden is same % of income for all households, progressive tax = % increases as income increases, regressive tax = % decreases as income increases. Marginal v. average tax rates: marginal tax rate = tax rate paid on any additional income you earn, somewhat influences our behavior, average tax rate = total amount of tax you pay divided by taxable income.

Get access

Grade+
$40 USD/m
Billed monthly
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
10 Verified Answers

Related Documents

ECON 201 Chapter 13: Chapter 13- Aggregate supply and aggregate demand (Macroeconomics Hubbard and O'Brien 6th Edition)
emeraldherring443
ECON 102 Lecture Notes - Lecture 14: Disposable And Discretionary Income, Fiscal Multiplier, Consumption Function
jadekangaroo548
ECON 102 Lecture Notes - Lecture 7: Ceteris Paribus, Aggregate Supply
goldgoat17

Related Questions

Oil Price Shocks
Both the long-run aggregate supply curve and the short-run aggregate supply curve shift in response to changes in the availability of labor or capital or to changes in technology and productivity. A widespread temporary change in the prices of factors of production, however, can cause a shift in the short-run aggregate supply curve without affecting the long-run aggregate supply curve.

Tasks:
Suppose there is a temporary but significant increase in oil prices in an economy with an upward-sloping Short-Run Aggregate Supply (SRAS) curve. If policymakers wish to prevent the equilibrium price level from changing in response to the oil price increase, should they increase or decrease the quantity of money in circulation? Why?
APA guidelines, standards, and formatting.

1. Explain how the real balance effect works?

2. How will either the AD curve or SRAS curve shift as a result of each of the following changes:

A rise in the interest rate

An adverse supply shock

A rise in wealth

3. Explain what happens to U.S. net exports and U.S. aggregate demand as the dollar depreciates

4. Explain what happens to aggregate demand in each of the following cases: (a) The interest rate rises; (b) Wealth falls; (c) The dollar depreciates relative to foreign currencies; (d) Households expect lower prices in the future; (e) Business taxes rise.

5. Explain how expectations about future sales will affect investment.

6. Explain how each of the following can affect short-run aggregate supply: (a) An increase in wage rates; (b) A beneficial supply shock; (c) An increase in the productivity of labor; (d) A decrease in the price of a nonlabor resource (such as oil).

(a) An increase in SRAS that is greater than the increase in AD will lead to an increase in Real GDP and a fall in the price level.

(b) A decrease in AD that is greater than the increase in SRAS will lead to a fall in both the Real GDP and the price level.

(c) An increase in SRAS that is less than the increase in AD will lead to an increase in both the