Discretionary policy deficits are associated with
A)higher interest rates,higher prices,and lower output
B)higher interest rates,higher prices,and higher output
C)higher interest rates,lower prices,and lower output
D)higher interest rates,lower prices,and higher output
E)lower interest rates,lower prices,and lower output

Question

Quizplus · Accepted Answer

Discretionary policy deficits typically involve increased government spending or tax cuts, which can boost aggregate demand, leading to higher output and prices. The increased demand for funds can also lead to higher interest rates.

Discretionary Policy Deficits Are Associated with