Economics plz help//////////////// how might a nation's production

[Eris]

possibilites be affected by the followed? a) A decrease in taxes.
b) An increase in Government regulation
c) An increase in military spending

please help thanks
d) AN INCREASE IN COLLEGE TUITION
E) FASTER MORE POWERFUL ELECTRONIC CHIPS.

[nomad]

"a) A decrease in taxes."

If you decrease taxes, a nations production should go up. When you cut taxes, this is what happens: The individual person gets more money to spend at the end of the year than they normally would. If person X earned Y amount of money and 50% of that money was taken away via taxes, then that person has only 50% of his original income to spend. That's bad for the economy. But, if only 25% was taken away via taxes then that gives the individual more money. What this results in is people spending more money. If you have $1,000 as opposed to $750, that's $250 more that you're putting into the economy. How does this affect production? The more money that people have to spend, the more demand there will be on products. The greater demand, the more sense it will make for companies like Sony and Nike to expand themselves and increase the quantity of products made.

"b) An increase in Government regulation"

This takes away from a nation's production. The more you limit companies, the less efficiently they can produce things. FOR EXAMPLE: If you tell Exxon that they can only drill in certain parts of the country, as opposed to any part, this limits their drilling to only certain parts as opposed to any part. It would be much more economically convenient if they were given the freedom to drill wherever they want and it would certainly increase productivity.

"c) An increase in military spending"

This one can go either way. An increase in military spending can increase a nation's production because the more you spend on military, the more need there is for military equipment. This helps the defense industry enormously. But, an increase in military spending can also mean a decrease somewhere else. In the US, an increase in military spending only helps the defense industry.