Identity the true, false and uncertain arguments. Economists that favor tax cuts

Question

Identity the true, false and uncertain arguments. Economists that favor tax cuts recommend them as a first line of defense during recessions. During the 2008-2009 downturn, the Fed favored monetary policy over fiscal policy. In 2009 economists in the Obama administration estimated that the tax cuts multiplier was lower than the multiplier of government purchases. Critics of government spending hikes worry about the additional savings brought about by tax cuts. The 2008-2009 downturn would have been worse if there had been no stimulus package. Because investment is the most volatile element of the GDP, investment tax credit expansions give additional stimulus to aggregate supply.

Explanation / Answer

a)True

b)Fasle

c)False

d)uncertain

E)uncertain

f)True

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