An increase in government purchases will NOT increase the level of output if
A) the AS-curve is totally price elastic
B) the price level is fixed
C) wages and prices are completely rigid
D) wages and prices are completely flexible
E) real money balances are not affected
Correct Answer:
Verified
Q33: To maintain a fixed level of aggregate
Q34: In which of the following cases is
Q35: A shift of the AD-curve to the
Q36: Expansionary fiscal policy is very effective in
Q37: When nominal money supply is held constant
Q39: If government purchases and taxes are both
Q40: Fiscal policy will affect prices and interest
Q41: As nominal money supply is steadily increased
Q42: Supply-side economics involves policy measures designed to
A)encourage
Q43: A large decrease in the income tax
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