The U.S. National Commission on Fiscal Policy and Reform has recommended changes to government expenditures and taxes which they claim would reduce the increase in the national debt between 2012 and 2020 to $4 trillion rather than $8 trillion
What are the commission's 5 recommendations?
1. Eliminate or reduce tax breaks for home mortgage interest, employer health care coverage, the tax exemption for municipal bonds, and preferential tax rates for capital gains and dividend income.
2. Increase the federal government tax on gasoline by 15 cents a gallon.
3. Increase taxes on higher-income households by raising or eliminating the income cap on Social Security payments.
4. Cap federal spending such as farm subsidies and defense spending.
5. Increase the retirement age from 67 to 69 in the future to reduce Social Security expenditures, and significantly increase Medicare premiums.
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Investment is defined as
A) the purchase of a stock or bond. B) the purchase of new capital goods by firms. C) spending on capital goods by governments. D) what consumers do with their savings. E) financial capital.
If real GDP is greater than potential GDP, then to restore equilibrium, ________ and the price level ________
A) the aggregate supply curve shifts rightward; falls B) the aggregate demand curve shifts leftward; rises C) the aggregate supply curve shifts leftward; rises D) the aggregate demand curve shifts rightward; falls E) potential GDP increases; falls