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In the Long Run, You Would Expect Fiscal Expansion to

Question 46

Multiple Choice

In the long run, you would expect fiscal expansion to


A) increase real interest rates but leave real GDP and prices unchanged.
B) increase prices but leave real interest rates and real GDP unchanged.
C) reduce real interest rates even as prices and real GDP climb.
D) increase prices, real GDP, and real interest rates to some degree or other depending on circumstance.
E) none of the above.

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