Asked by Emily Yannatone on May 21, 2024
Verified
The tax cut of 1964 (proposed by President Kennedy) :
A) was the last time fiscal policy was used.
B) was the greatest failure as a demand-management tool.
C) actually increased investment,consumption,and employment.
D) shifted the aggregate demand curve leftward.
E) was the first time the focus moved away from managing aggregate demand to focusing exclusively on aggregate supply.
Tax Cut
A reduction in the amount of taxes imposed by the government.
Fiscal Policy
involves government spending and tax policies to influence economic conditions, including levels of employment, inflation, and economic growth.
- Gain an understanding of the significance and consequences of fiscal policy in historical times, with a focus on the Golden Age of the 1960s and Reaganomics.
- Explore the implications of fiscal policy determinations on economic indicators like GDP performance, unemployment rates, and the inflation index.
Verified Answer
KW
Kenyetta WallerMay 23, 2024
Final Answer :
C
Explanation :
The tax cut of 1964, also known as the Revenue Act of 1964, was proposed by President Kennedy but was signed into law by President Johnson after Kennedy's assassination. The tax cut reduced personal and corporate income tax rates, which led to an increase in investment, consumption, and employment. This resulted in an expansion of the economy, indicating that the tax cut was successful in managing demand. Therefore, option C is the correct answer.
Learning Objectives
- Gain an understanding of the significance and consequences of fiscal policy in historical times, with a focus on the Golden Age of the 1960s and Reaganomics.
- Explore the implications of fiscal policy determinations on economic indicators like GDP performance, unemployment rates, and the inflation index.