Suppose that several Asian countries enter a recession, decreasing Australian exports. To move Australian GDP back to potential GDP, the Reserve Bank of Australia should

Name: Suppose that several Asian countries enter a recession, decreasing Australian exports. To move Australian GDP back to potential GDP, the Reserve Bank of Australia should
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Quizplus · Accepted Answer

Lowering the cash rate would reduce borrowing costs, stimulate spending and investment, and help increase aggregate demand, moving GDP back to potential.

Suppose That Several Asian Countries Enter a Recession, Decreasing Australian