Podcast
Questions and Answers
How does the presence of a common market impact the effectiveness of fiscal policies implemented by individual member states?
How does the presence of a common market impact the effectiveness of fiscal policies implemented by individual member states?
- It has no significant impact as fiscal policies are determined solely at the national level.
- It amplifies the impact of fiscal policies due to increased trade and economic integration.
- It reduces the effectiveness of fiscal policies due to leakages and spillover effects to other member states. (correct)
- It necessitates complete harmonization of fiscal policies across all member states.
Which of the following scenarios represents a situation where discretionary fiscal policy would be most effective in stabilizing an economy?
Which of the following scenarios represents a situation where discretionary fiscal policy would be most effective in stabilizing an economy?
- An economy in a liquidity trap where interest rates are near zero and monetary policy is ineffective. (correct)
- An economy with a balanced budget and a commitment to fiscal austerity.
- An economy that is already operating at its full employment level with stable inflation.
- An economy experiencing a supply-side shock due to a sudden increase in global commodity prices.
What is the primary risk associated with using fiscal policy to address a short-term economic downturn when the national debt is already high?
What is the primary risk associated with using fiscal policy to address a short-term economic downturn when the national debt is already high?
- It may increase interest rates, crowding out private investment and hindering long-term growth. (correct)
- It will always lead to a stronger currency, making exports more competitive.
- It will have no significant impact as long as the stimulus is temporary.
- It will inevitably lead to hyperinflation due to increased money supply.
How do automatic stabilizers function in an economy, and what is their primary advantage over discretionary fiscal policy?
How do automatic stabilizers function in an economy, and what is their primary advantage over discretionary fiscal policy?
In the context of fiscal policy, what is the 'crowding-out effect,' and under what conditions is it most likely to occur?
In the context of fiscal policy, what is the 'crowding-out effect,' and under what conditions is it most likely to occur?
Flashcards
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Study Notes
Chapter Overview
- Arguments can be good or bad, depending on the relationship between premises and conclusion
- A fallacy is a defect in an argument that consists in something other than merely false premises
- Fallacies often involve mistakes in reasoning or creating illusions to make a bad argument appear good
- Fallacies can be committed in deductive or inductive arguments due to problems in reasoning, argument form, or premise content
Types of Fallacies
- Formal fallacies: structural defects in deductive arguments
- Informal fallacies: defects in the content of an argument (beyond structure)
Informal Fallacies
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Fallacies of relevance: premises are logically irrelevant to the conclusion
- Fallacy of appeal to force
- Fallacy of appeal to pity
- Fallacy of appeal to the people
- Bandwagon fallacy
- Appeal to vanity
- Appeal to snobbery
- Argument against the person (ad hominem)
- Ad hominem abusive
- Ad hominem circumstantial
- Tu quoque
- Missing the point (ignoratio elenchi)
- Red herring
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Fallacies of weak induction: premises offer weak support for the conclusion
- Appeal to unqualified authority
- Hasty generalization
- False cause
- Post hoc, ergo propter hoc
- Non causa pro causa
- Weak analogy
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Fallacies of presumption: premises presume what they purport to prove
- Begging the question (petitio principii)
- Complex question
- False dichotomy
- Suppressed evidence
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