The way of your teaching and the content is absolutely brilliant but we need such kind of videos on advance topics which are little difficult to understand like IS LM curve and many other topics like tha kindly make a saperate channels on advanced macroeconomics and microeconomics and make those also easy for us like that
I think its cos u assume consumers are utility maximisers so they are more likely to increase there utility by buying more expensive goods as they are better so as a result MPC increases
Yeah, it makes people actually spend their money rather than saving it, therefore keeping the money in the circular flow instead of reducing the money flow.
Could you also say that for the LRAS shifting right due to Fisacsl policy this could be a reduction in the corporation Tax Rate . Reducing corporation tax means firms have higher RETAINED profits to invest on capital goods on the economy which INCREASE THE PROSUXIRVE CAPAVITY IF AJ ECONOMY . Also firms nigh have a higgher marginal prospensity to invest and so invest more ie in capital goods which not only increase the preocugive capacity hit also INCREASE THE PREOCIRVE EFFICENCY IF there is a fall in LRC for all firms due to increasss in investment .
Hi! Awesome video, I am currently writing my thesis on China's taxation using fiscal sociology, is there a difference between fiscal policy and fiscal sociology? Can I use these terms interchangeably?
I've read through the AQA AS and A-level economics specification, and it does not state anything about the two types of fiscal policies (expansionary and contractionary). So, is the expansionary fiscal policy the basic one that we need to learn for the exam, or do we have to know both to pass. (I understand that if I want to boost up my essays...etc.. I should learn both, but which one is essential?)
for contractionary (downward sift in AD), you said redistribute income, however wouldn't this give the poor more money and as they have a high mpc they would spend more, increasing AD rather than decreasing??
If the government increases taxation in a progressice tax system then it is contractionary fiscal policy. They could use the money gained from this contractionary fiscal policy to do expansionary fiscal policy which is redistributing the money they gained from taxes. The points which are made is just ways in which government can use fiscal policy, it is not the direct cause of fiscal policy.
It can apply to monetary policy depending on which type. It can apply to expansionary as a decrease in interest rates lead to higher disposable incomes and so expenditure rises. This is a circular process.
