With the market in equilibrium, is the current fiscal policy generating a surplu

Question

With the market in equilibrium, is the current fiscal policy generating a surplus(+) or a deficit(-) and if so how much?

Due to a decrease in housing prices, households experienced a $9 billion change in consumption. Draw a new line on the graph that reflects this change.

What is the new price level and output level?

What is the size of the GDP gap?                 Would you expect unemplpyment to go up or go down?

What phase of the business cycle is this economy in now?

How much is the cyclical defict (-) or surplus (+)?

What is the estimated level of cyclical unemployment (round up)?

What type of fiscal policy should the government implement?

If the government wanted to change taxes (to return to full-employment), should they increase taxes or decrease taxes and how much ($)

Explanation / Answer

Hi Angie...I actually have the same question and am wondering if you could please help?! I've tried to contact landerkelly50@gmail.com, but haven't heard back yet. Any info would help. :)

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