In a closed economy, contractionary fiscal policy causes:
A) interest rates to rise and aggregate demand to increase.
B) interest rates to fall and aggregate demand to decrease.
C) interest rates to rise and aggregate demand to decrease.
D) interest rates to fall and aggregate demand to increase.
E) interest rates to rise and aggregate demand does not change.
Correct Answer:
Verified
Q26: Which of the following is true with
Q27: When the government employs a combination of
Q28: A contractionary fiscal policy:
A) lowers the federal
Q29: A contractionary fiscal policy:
A) puts upward pressure
Q30: As a government adopts a contractionary fiscal
Q32: In a closed economy, a contractionary fiscal
Q33: In an open economy, a contractionary fiscal
Q34: Which of the following is usually associated
Q35: Expansionary monetary policy in the U.S. is
Q36: Which of the following is not associated
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