Assignment

The second section of the exam will have 2 of the following short essay questions. Each of the two essay questions selected will be worth 30 points each. As mentioned in class, these are short essays (at least % page in length. Shorter answers will not be eligible for full credit). Essays are graded on content and clarity.

1. Identify one of the business cycle theories that were discussed in class. Highlight four important points about your selected theory. Does this theory sufficiently describe why business cycles occur? Why or why not? Explain your answer.

2. What is fiscal policy? Who are the parties involved in creating fiscal policy in the U.S. economy? What are the two general types of fiscal policy? What 2 tools are used to implement fiscal policy? When are the two general types of fiscal policy used according to economic theory? Be specific in your answer.

3. Economists debate whether discretionary fiscal policy is an effective way to control and stimulate the economy. Present 2 arguments in favor of the view that fiscal policy is effective and 2 arguments that fiscal policy is ineffective or destructive to the economy. Be specific.

4. What is the size of the U.S. public debt? Who owns the U.S. public debt? What impact does the U.S. public debt have on the budget of the U.S. federal government? Be specific in your answer.

5. What is the debt to GDP ratio for the U.S. public debt for 2018? Is the U.S. national debt beneficial or detrimental to the U.S. economy? Provide and explain three reasons to support your answer. Be specific.

6. Select any nation around the world (excluding the United States or your home country). Describe how that the national government of your selected country is currently using fiscal policy (either in an expansionary, neutral, or contractionary way). Provide four sets of data regarding fiscal policy to support your answer.