What Are Two Ways the Government Can Maintain Full Employment

question 40

Essay

What are two ways the government can maintain full employment in an open economy?
Also give an example for each.

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Definitions:

Capital Structure

The mixture of debt and equity that a company uses to finance its operations and growth.

Tax Shield

The reduction in income taxes that result from taking a deductible expense, such as mortgage interest, which reduces taxable income.

Financial Distress Costs

Expenses that a company faces when it is having difficulty meeting its financial obligations, which can include legal, restructuring, and operational costs.

Debt-equity Ratio

The ratio highlighting the financial mix of equity and debt used in the acquisition of company assets.