If households use tax rebate checks to pay off their existing debt (such as credit cards and mortgages) ,this type of fiscal stimulus:
A) is likely to have a large impact on aggregate demand.
B) is likely to have a negligible impact on aggregate demand.
C) will only lead to higher inflation,not to an increase in the growth rate of output.
D) will lead to a higher growth rate of output,but not to higher inflation.
Correct Answer:
Verified
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