Government Spending and Economic Impact

The video tutorial discusses fiscal policy with a focus on government spending in the UK. It explains the three main types of government spending: welfare, current, and capital spending. The video provides a breakdown of government spending in 2015-16, highlighting key areas such as healthcare, education, and defense. It also discusses the impact of government spending on the economy, including regional development and equity. The tutorial concludes with the role of government spending in fiscal policy and its implications for economic growth.

What percentage of the UK's national output was government spending last year?

• 42-43%

• 30-31%

• 60-61%

• 50-51%

Which of the following is NOT a type of government spending?

• Private Investment

• Capital Spending

• Current Spending

• Welfare

What was the largest single item of government spending in 2015-2016?

• Education

• Defense

• Social Welfare Protection

• Healthcare

What is the purpose of the welfare cap introduced by the UK government?

• To eliminate welfare benefits

• To limit the maximum welfare a family can receive

• To provide unlimited welfare to all

• To increase welfare spending

What is the 'triple lock' related to state pensions?

• A cap on pension spending

• An increase by inflation, earnings growth, or 2.5%

• A reduction in pension benefits

• A fixed pension amount

How has NHS spending as a share of GDP changed in recent times?

• Increased significantly

• Decreased significantly

• Remained the same

• Slightly decreased

What is the key distinction between current and capital spending?

• Current spending is recurring, capital is for infrastructure

• Both are for recurring expenses

• Both are for infrastructure

• Current spending is for infrastructure, capital is for services

How does government spending influence regional economic impact?

• By expanding spending in less prosperous areas

• By reducing taxes

• By increasing imports

• By cutting public services

What is the forecast for the UK's budget deficit according to the IMF by 2018-2019?

• It will increase

• It will be eliminated

• It will double

• It will remain the same

Why is government spending considered a key component of aggregate demand?

• It increases exports

• It influences economic growth and equity

• It decreases public debt

• It reduces inflation