Fiscal Policy Calculator

Government Spending Increase ($billions):

Marginal Propensity to Consume (MPC):

Tax Rate (%):

Marginal Propensity to Import:

Baseline GDP ($billions):

Current Unemployment Rate (%):

Economic Cycle Phase:

Tax Cut Amount ($billions):

Tax Type:

MPC of Tax Cut Recipients:

Direct Revenue Loss ($billions):

Behavioral Response Factor:

Fiscal Injection ($billions):

Policy Type:

Time Horizon:

Crowding Out Factor:

Fiscal Multiplier: 0.00

Total GDP Impact: $0.00B

Employment Effect: 0 jobs

Budget Deficit Impact: $0.00B

Debt-to-GDP Change: 0.0%

Policy Effectiveness: Moderate

Fiscal Multiplier: The ratio of change in national income to the change in government spending that causes it.

Government Spending Multiplier: k = 1 / (1 - MPC(1-t) + MPM), where t is tax rate and MPM is marginal propensity to import.

Tax Multiplier: Typically smaller than spending multiplier because some of tax cuts go to savings.

Crowding Out: Government borrowing can increase interest rates, reducing private investment.

Automatic Stabilizers: Built-in fiscal responses like unemployment insurance that activate during recessions.

Ricardian Equivalence: Theory that tax cuts may not stimulate if people save expecting future tax increases.