Identify Each of the Following as (I)part of an Expansionary

question 89

Essay

Identify each of the following as (i)part of an expansionary fiscal policy,(ii)part of a contractionary fiscal policy,or (iii)not part of fiscal policy.
a.The personal income tax rate is lowered.
b.Congress cuts spending on defense.
c.College students are allowed to deduct tuition costs from their federal income taxes.
d.The corporate income tax rate is lowered.
e.The state of Nevada builds a new tollway in an attempt to expand employment and ease traffic in Las Vegas.

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Definitions:

Direct Material Costs

The costs of raw materials that can be directly traced to the production of a specific product.

Direct Material Quantity Variance

The difference between the actual amount of direct materials used and the standard amount expected to be used, multiplied by the standard cost per unit of material.

Actual Quantity Purchased

The true amount of materials or goods that a company buys within a specific time frame, which can be compared to budgeted or planned quantities.

Fixed Manufacturing Overhead Volume Variance

The difference between budgeted fixed manufacturing overhead and the amount applied to production, based on standard hours.