Fema Employment
To achieve full-employment output (exactly), government should?
Suppose the price level is fixed, the MPC is .8, and the GDP gap is a negative $320 billion. To achieve full-employment output (exactly), government should: 1) increase government expenditures by $320 billion. 2) increase government expenditures by $80 billion. 3) reduce taxes by $320 billion. 4)reduce taxes by $80 billion.
Public Comments
- 3) reduce taxes by $320 billion.
- How can GDP be negative? If it is then the country is in a poor way and none of the proposals will help because they only redistribute the money around without actually affecting total production and services. To achieve full employment one needs to raise opportunities for doing useful work by the reduction of rent on land. Making more land available will achieve this by taxing the land speculators according to the imposition their land holding is hurting and slowing down the rest of the society.
