It may be necessary to cut the deficit as part of a credible anti-inflationary policy because the public knows that large deficits ________.
A) are inflationary by themselves in the long run
B) create inefficiencies
C) put pressure on the Bank of Canada to expand the money supply to keep interest rates from rising
D) put pressure on the Bank of Canada to contract the money supply to prevent employment from rising
Correct Answer:
Verified
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