In the medium run, a fiscal contraction that causes a decrease in the budget deficit:
A) affects the level of output but not its composition.
B) affects both the level and composition of output.
C) will not affect the composition of output but will affect the price level.
D) is neutral.
E) affects only the composition of output.

Question

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The Answer of In the medium run, a fiscal contraction that causes a decrease in the budget deficit:
A) affects the level of output but not its composition.
B) affects both the level and composition of output.
C) will not affect the composition of output but will affect the price level.
D) is neutral.
E) affects only the composition of output.

In the Medium Run, a Fiscal Contraction That Causes a Decrease