When an economy faces an inflationary gap, an appropriate fiscal policy is to
A) decrease taxes.
B) decrease government expenditure.
C) decrease the quantity of money.
D) increase the quantity of money.
E) increase aggregate demand.
Correct Answer:
Verified
Q123: Q124: Need-based spending -------------------- during an expansion and-------------------- Q125: Taxes that change with the level of Q126: A $100 million decrease in government expenditure Q127: If a tax cut increases people's labor Q129: If we look at the federal government Q130: If the nominal interest rate is 10 Q131: Ignoring any supply-side effects, if government expenditure Q132: The crowding out effect refers to the--------------------from--------------------in Q133: Suppose the economy is in an equilibrium
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