Suppose That Economic Policy Makers Want to Increase Real GDP

question 83

Essay

Suppose that economic policy makers want to increase real GDP by $100 with as little impact on the budget balance as possible. Should they increase government purchases of goods and services, increase transfer payments, or decrease taxes?

---

Definitions:

Paraphyletic Clade

A group of organisms that includes an ancestral species and some, but not all, of its descendants.

Tetrapods

Vertebrate animals with four limbs, or descent from such organisms, including amphibians, reptiles, mammals, and birds.

Lobe-Finned Fish

A group of fish characterized by fleshy, lobed, paired fins, which are precursors to the limbs of land vertebrates.

Wrist Bones

The small bones that make up the human wrist, contributing to its complex range of motion and dexterity.