Practise comparing fiscal, monetary, supply-side, exchange-rate and trade policies across inflation, jobs, growth and external balance while evaluating conflicts and government…
Increased borrowing by the government results in higher interest charges and this leads to less private investment expenditure.
Of what is this an example?
an automatic stabiliser
crowding out
the accelerator
the substitution effect
What does the Laffer curve show?
the amount of tax revenue received at each tax rate
the impact on the distribution of income after tax rates rise
the rise in inflation following a fall in unemployment due to a cut in income tax
the rise in poverty due to a rise in the basic rate of income tax
A government wishes to increase economic efficiency in the country. It raises the rate of income tax which leads to the emigration of high-earning skilled workers that the country needs.
How would this outcome be described?
government
failure
market failure
negative
externality
no
no
yes
no
yes
no
yes
yes
no
yes
no
no
