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In 2008, When a Recession Started, the Growth of Government

Question 3

Multiple Choice

In 2008, when a recession started, the growth of government expenditures on goods and services doubled compared to its growth in 2007. According to the aggregate demand theories of the business cycle


A) government expenditure was at least a partial cause of the recession.
B) government expenditure was not a cause of the recession.
C) government expenditure was definitely the cause of the recession.
D) None of the above answers are correct because aggregate demand theories of the business cycle focus only on investment and consumption expenditure.

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