Which of the following reflects a coordination problem in aggregate demand?
A) Congress approves increases in government spending that are insufficient to stimulate aggregate demand.
B) Congress wants to maintain balanced budgets during a recession rather than running budget deficits.
C) Congress increases spending in areas that are already at or near full-employment.
D) Automatic stabilizers shift the budget toward a surplus during an expansion and a deficit during a recession without Congressional action.
Correct Answer:
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