An Advantage of Demand-Side Fiscal Policies Is That They Do

question 153

True/False

An advantage of demand-side fiscal policies is that they do not always require tradeoffs between price levels and output, while supply-side fiscal policies sometimes do.

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Definitions:

Payroll Tax

Obligations enforced on either the workforce or the employers, generally estimated as a share of the compensation employers offer to their staff.

Proportional Taxes

Taxes that are imposed at a constant rate regardless of the income level of the taxpayer.

Regressive Effect

A situation where a tax or fiscal policy disproportionately affects lower-income individuals, making them pay a higher percentage of their income than wealthier individuals.

Economic Role

The function or position held by an entity or individual within an economic system, influencing the allocation of resources and creation of goods and services.