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Article on US Economy’s Fiscal Policy

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Added on  2020-05-11

Article on US Economy’s Fiscal Policy

   Added on 2020-05-11

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Running head: MACROECONOMICSMACROECONOMICSName of the StudentName of the UniversityAuthor’s Note
Article on US Economy’s Fiscal Policy_1
1MACROECONOMICSTable of ContentsIntroduction......................................................................................................................................2Articles related to Federal Budget, taxes, deficit spending in US...................................................2Conclusion.......................................................................................................................................3References........................................................................................................................................4
Article on US Economy’s Fiscal Policy_2
2MACROECONOMICSIntroductionThe study highlights on the US economy’s fiscal policy that is analyzed based on the articlerelated to federal budget, taxes and deficit spending. Fiscal policy refers to the changes that thegovernment of the respective nations makes in their federal budget for influencing the growth ofthe economy. Fiscal policy is classified in two types- expansionary and contractionary fiscalpolicy. Expansionary fiscal policy refers to the policy that the government adopts duringrecession that aims in increasing aggregate demand through rise in government expenditure ordecline in taxes (Afonso & Sousa, 2012). On the contrary, contractionary fiscal policy isimplemented during inflation for decreasing aggregate demand through reduction in governmentexpenses or rise in taxes.Articles related to Federal Budget, taxes, deficit spending in USThe articles relating to federal budget of US reflects how the budget prepared by presentpresident makes cuts in the nations program. This article highlights that not all the departmentswill suffer from the budget proposal of Donald Trump that covers $1.1 trillion of discretionaryexpenditure for the year 2018, $52 billion for defence department and $2.8 billion for securitydepartment. In addition, the budget proposal also reflects that additional amount of $1.5 billionwill move towards transport and illegal immigrant’s removal (Corsetti et al., 2013). In order tobuild –up the defense sector of the economy, the president slashed their budget in other sectorsalso. However, there would be reduction of 16% in Health and Services department, 14% inEducation department and 29% in State department. Therefore, it is predicted that this budgetproposal will keep the expenditure at same level. As US has recovered from recessionary period,this federal budget will influence on the total aggregate demand of the economy.
Article on US Economy’s Fiscal Policy_3

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