Suppose the economy is in long-run equilibrium. If the federal government cuts government Jspending, which of the following is likely to result?
A) an increase in real GDP and an increase in the price level
B) an increase in unemployment and an increase in the price level
C) a decrease in unemployment and a decrease in the price level
D) a decrease in the price level and an increase in unemployment
Correct Answer:
Verified
Q77: An expansionary fiscal policy
I. includes an
Q78: Figure 12-2 Q79: Figure 12-1 Q80: Figure 12-1 Q81: Suppose that income taxes are reduced by Q81: Suppose the government institutes a new investment Q84: Figure 12-3 Q85: Suppose that income taxes are increased by Q87: Figure 12-2 Q90: Which of the following best explains why Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents
