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1. When an economy experiences inflationary and recessionary gaps, how can government adjust spending and taxes to help close the gap?

2. What role do automatic stabilizers play in this?

3. Are there problems with using fiscal policies to close a gap? If so, what are the problems?

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The previous videos addressed the macroeconomic goals; this video addresses the idea of fiscal policy (government spending and taxation) as a possible way to target the goals. "(Macro) Episode 26: Fiscal Policy" by Dr. Mary J. McGlasson is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

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Should we use fiscal policy? This video presents some of the problems you might encounter in implementing such policy. "(Macro) Episode 27: Crowding Out & Lags" by Dr. Mary J. McGlasson is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

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Brief overview of where the Federal Government dollars come from and what those tax dollars get spent on, and the difference between progressive, proportionate (flat), and regressive tax structures. "(Macro) Episode 28: Taxes & Budget" by Dr. Mary J. McGlasson is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

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Play "The Fiscal Ship" and make your own plan to keep U.S. debt from rising

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A new game from Brookings and the Wilson Center puts you in control of the federal budget.