The Central Bank of Libertina increases the money supply at the same time the Parliament of Libertina passes a new investment tax credit.Consider the effects of these policies on the Libertinian economy.The money supply increase

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Quizplus · Accepted Answer

The money supply increase and the investment tax credit both stimulate aggregate demand. The money supply increase makes it easier for people to borrow money and spend it, while the investment tax credit makes it cheaper for businesses to invest. Both of these policies will lead to an increase in spending and economic growth.

The Central Bank of Libertina Increases the Money Supply at the Same