If the government decreases government expenditures, then in the short run, prices

Name: If the government decreases government expenditures, then in the short run, prices
Brand: Quizplus
Rating: 4.9 (56 reviews)

Question

Quizplus · Accepted Answer

When the government decreases government expenditures, it reduces the overall demand in the economy. This leads to lower prices due to decreased demand, and higher unemployment as businesses adjust to the reduced spending by cutting back on production and potentially laying off workers.

If the Government Decreases Government Expenditures, Then in the Short