EconomicsCode 9708
Fiscal policy
What this topic asks you to be able to do
- meaning of government budget
- how a government budget deficit differs from a surplus
- what the national debt is and why it matters
- taxation: kinds of taxes: direct/indirect, progressive/regressive/proportional; tax rates: marginal and average rates of taxation (MRT, ART); purposes of taxation
- government spending: its kinds, capital (investment) and current; why governments spend
- the difference separating expansionary fiscal policy from contractionary fiscal policy
- the effect of expansionary and contractionary fiscal policy, analysed with AD/AS, on equilibrium national income, real output, the price level and employment