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"The Only Thing That Results from Expansionary Demand-Side Fiscal Policy

Question 79

Multiple Choice

"The only thing that results from expansionary demand-side fiscal policy is that the price level will rise." The economist who said this most likely believes that


A) there is likely to be a lot of crowding out if government spending rises.
B) the AS curve is vertical.
C) there is unlikely to be much crowding out if government spending rises.
D) investment is interest inelastic.
E) b and c

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