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Chapter 12: Problem 24

The main feature of the 2008 economic stimulus package was (LO6) a) taxpayer rebates. b) an across-the-board tax cut. c) an increase in spending on food stamps and unemployment benefits. d) a large highway building program.

Short Answer

Expert verified
The main feature of the 2008 economic stimulus package was \(a)\) taxpayer rebates, which aimed to boost consumer spending and support the economic recovery during the Great Recession.

Step by step solution

01

Understanding the 2008 economic stimulus package

The 2008 economic stimulus package was designed to stimulate the US economy during the Great Recession. It aimed to boost consumer spending and thereby support the economic recovery.
02

Analyzing the four options

a) Taxpayer Rebates: These are cash payments to taxpayers, which are meant to boost their spending and spur economic growth. b) Across-the-board tax cut: This refers to a reduction in taxes for everyone, which is intended to increase disposable income and encourage spending. c) Increase in spending on food stamps and unemployment benefits: This involves additional government spending on social safety nets, which is supposed to directly help those in need and thus also stimulate the economy. d) Large highway building program: This entails large-scale infrastructure projects, which are often geared towards boosting the economy through job creation.
03

Determining the main feature

The main feature of the 2008 economic stimulus package was taxpayer rebates (a). The package provided tax rebates to millions of taxpayers, aiming to encourage consumer spending and kickstart the economy. It also included other measures, such as increasing spending on food stamps and unemployment benefits, but the primary focus was the tax rebates.
04

Conclusion

The correct answer is (a) taxpayer rebates. The 2008 economic stimulus package's main feature aimed at boosting consumer spending and supporting economic recovery during the Great Recession.

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Most popular questions from this chapter

Which statement is true? (LO9, 11) a) About one-third of the national debt is rolled over (or refinanced) every year. b) The national debt is doubling every 10 years. c) Unless we balance the budget within the next five years, the United States stands a good chance of going bankrupt. d) None of these statements is true.

Which is the most accurate statement? (LO8) a) The Chinese stimulus package was more successful than the American stimulus package. b) The American stimulus package was more successful than the Chinese stimulus package. c) The Chinese and American stimulus packages were equally successful.

Statement 1: A tax cut will have the same impact on the recessionary gap as an increase in \(\mathrm{G}\) only if people spend the entire tax cut. (LO1) Statement 2: The paradox of thrift is more relevant today, when savings are so low, than it was back in the \(1950 \mathrm{~s}\) and \(1960 \mathrm{~s}\). a) Statement 1 is true and statement 2 is false. b) Statement 2 is true and statement 1 is false. c) Both statements are true. d) Both statements are false.

There is an inflationary gap when (LO1) a) equilibrium GDP is equal to full-employment GDP b) equilibrium GDP is smaller than full-employment GDP c) equilibrium GDP is larger than full-employment GDP d) none of these occur

Between 1998 and 2000 the federal budget surplus and the publicly held national debt \((L \mathrm{~L}, 9)\) a) rose, rose c) rose, fell b) fell, fell d) fell, rose
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