Friday, May 15, 2020
Fiscal Policy ( Private And Public ) - 1033 Words
For any economy, fiscal policy has two primary goals, an economic goal and a social goal. Regarding the economic goal, fiscal policy has to ensure suitable and sustainable economic growth rates that maintain unemployment rate at its natural level and at the same time do not generate inflationary pressures. At social level, on the other hand, fiscal policy has to ensure a degree of equity regarding the distribution of incomes in the economy, and to direct considerable part of available resources toward essential investments that provide necessary goods and services consumed mainly by the vast majority of population. 3.1 Evaluating the Economic Role of Fiscal Policy Investment spending (private and public) is the main engine to stimulate economic growth. Securing adequate savings is a prerequisite for any investment spending; however, investment projects need not just to secure adequate funding to cover their investment costs during construction periods, as they also need to secure adequate demand for their production to cover operational costs and to obtain appropriate return on investment during operational periods. While fiscal policy is playing a significant role in securing requirements of investment, domestic savings and aggregate demand for domestic production; then it is considered a governor element in determining the extent of investment prosperity and indispensible tool in correcting the imbalance between domestic investment, consumption and savings. 3.1.1Show MoreRelatedFiscal Policy as an Economic Stabilization Measure1604 Words  | 7 PagesFISCAL POLICY AS AN ECONOMIC STABILIZATION MEASURE Fiscal Policy refers to the various decisions undertaken by the government regarding public expenditures and revenue. There are a large number of sub-policies that are encompassed by the fiscal system. But all the policies can be broadly categorized as being either ‘Public Expenditure’ or ‘Public Revenue’. It can be said that the fiscal policy is a direct government intervention in the economic processes of an economy. The fiscal policyRead MoreDifference Between Aggregate Demand And The Price Level1747 Words  | 7 Pagesthrough its fiscal policy and the federal bank through its monetary policy try to influence aggregate demand to influence the overall economy. For example, an increase in the nominal money stock, as a result of monetary expansion policy, leads to a higher real money stock at each level of prices. In the asset market, the decrease in interest rates induces the public to hold higher real balances. It stimulates the aggregate demand and thereby increases overall economic activities and growth. Fiscal policyRead More Role Of Government In Mixed Economies Such As Australia Essay1741 Words  | 7 PagesCommonwealth government using fiscal and monetary policies to influence the Australian economy? What are the main features of the governments micro economic policy? Why is the government concerned about microeconomic reform? Synopsis: The role of government in Australia today has less influence on the market than they did a decade ago. It function now is to provide a stable internal and external balance under which the market can function. This is achieved through the use of fiscal, monetary and microeconomicRead MoreFiscal And The New Classical Macro Models Analysis953 Words  | 4 PagesThe effectiveness of fiscal police to stimulate economic activities has been a polemic topic for several years. This controversy exists basically due to differences between the Keynesian and the New Classical macro models analysis. However, what it is clear is that the government has the tools to adjust to positive or negative responses of economic fluctuations. Fiscal and monetary policies must be timely adjusted to overpass economic phasedowns using government spending or taxes. Consequently, goodRead MoreDiscuss the Ways in Which the Government May Use Fiscal Policy to Help the Economy Grow Out of a Recession1076 Words  | 5 Pages‘Discuss the ways in which the government may use Fiscal policy to help the economy grow out of a recession. Reference must be made to some policies that the current government has actually use’ Fiscal policy involves the use of government spending, taxation and borrowing to affect the level and growth of aggregate demand, output and jobs. Fiscal policy is also used to change the pattern of spending on goods and services. It is also a means by which a redistribution of income amp; wealth can beRead MoreMonetary Policy in Pakistan1045 Words  | 5 PagesMonetary policy in Pakistan | By Dr. M. Hanif Akhtar,  Department of Commerce,  B. Z. University, Multan                                                             Aug 28 - Sep 03, 2000Monetary policy in Pakistan has been used in co-ordination with the fiscal policy to achieve both the objectives of macro-economic stability and higher economic growth. The government supervises monetary situation of economy through the State Bank of Pakistan (SBP). This article attempts to present an overviewRead MoreEurozone Crisis Essay887 Words  | 4 PagesEuropean Union as a whole, with some peripheral countries experiencing larger increments. In what came to be known as the â€Å"Eurozone Crisis†, many peripheral countries, particularly Greece, Ireland, Italy, Portugal, and Spain, put in place policies of fiscal consolidation, aimed at tax hikes and budget cuts, and structural reforms along the lines proposed by the EU leaders and the ECB. The large budget deficits and high sovereign debts in these countries made market participants wary of lendingRead MoreThe Impact Of Neoclassical Economics On The Economy Essay1344 Words  | 6 Pagesgovernment policy as the laws of supply and demand will be self-correcting. John Maynard Keynes was an important figure that worked to apply fiscal policy that would remedy an economic depression. Keynes’s idea of fiscal policy is the means by which government adjusts its spending levels and tax rates to monitor and influence the economy. Further, Keynes is known as the father of â€Å"Mixed Economy†, in which both the private sector (households and privately owned businesses) and public sector (government)Read MoreDiscuss The Best Option For Australia And Will Justify The Rationale1706 Words  | 7 Pagesmonetary and fiscal policies has been specifically aimed at reducing inflation and implementing policies for sustained economic growth. This paper will present a discussion on the definitions of each policy while examining their role in economy. Based on the obtained insights, the paper will discuss the best option for Australia and will justify the rationale. In the end, the discussion will be given a conclusive shape in which the key learning will be summarized and future context of policy implementationsRead MoreEconomic Studies And Political Science1595 Words  | 7 PagesName : Abdelmonem Lotfy Mohamed Kamal Position: Assistant Professor of Economics and Public Finance : Faculty of Economic Studies and Political Science : Beni Suef University : Egypt E-mail : alotfy@eps.bsu.edu.eg Mailing Address: (9/8) Alshatr (2) Mashroo Iskan Sherket Almaadi, Zahraa Almaadi, Cairo, Egypt â€Å"Testing the Relation between Government Spending and Private Consumption in Egypt†Introduction: During the period 2004
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