Suppose real GDP is $12.1 trillion and potential GDP is $12.6 trillion. To move the economy back to potential GDP, the parliament should
A) lower taxes by an amount less than $500 billion.
B) lower government purchases by $500 billion.
C) lower taxes by $500 billion.
D) raise government purchases by more than $500 billion.
E) raise government purchases by $500 billion.
Correct Answer:
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Q2: You would expect less fluctuation in the
Q3: The sharp increase in the percentage of
Q4: Transfer payments include _
A) government aid to
Q5: Stabilization policy is used by the government
Q6: Fiscal policy is determined by the
A) the
Q8: The central bank Reserve plays a larger
Q9: Timing stabilization policy is easier using monetary
Q10: According to economist Christopher Ruhm, during recessions
Q11: The government debt equals
A) the accumulation of
Q12: Which of the following is considered a
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