If there is a recessionary gap in the economy, then it is producing _____ than its full employment level of output, and the government can _____ spending to close the gap.

Question

Quizplus · Accepted Answer

During a recessionary gap, the economy is producing less than its full employment level of output. To close this gap, the government can increase spending to stimulate economic activity.

If There Is a Recessionary Gap in the Economy, Then