Explain the difference between expansionary and contractionary fiscal policies

Define key terms: Expansionary - Used in deflationary gap to cause AD to shift right an stimulate economic growth (accelerator) and Fiscal - A set of government policies that increase the quantity and quality of the factors of production in a given economy by using taxation and government spending.
Draw diagram and explain it using real life example e.g. 2008 depression when the UK government bailed out the banks.

MD

Related Economics IB answers

All answers ▸

Work out the price elasticity of demand of Coca Cola when the demand rises from 1 million to 2 million following a price decrease of £1.50 to £1.35. Is this price elastic or price inelastic?


What is the demand and the supply in a market ? How can you draw them how do you derive the optimal price and quantity *?


What are the differences/similarities between perfect competition and monopolistic competition?


Discuss the impacts of a price ceiling on stakeholders