Suppose the economy is experiencing a inflationary gap and the government increases spending to close the gap.In the short run one would expect
A) output and the price level to remain constant.
B) output to increase and the price level to remain constant.
C) output and the price level to rise even further .
D) output to remain constant and the price level to rise.
Correct Answer:
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Q2: If the government wants to decrease real
Q3: An inflationary gap is
A)the difference between aggregate
Q4: A contractionary gap is
A)the difference between aggregate
Q5: The amount by which the equilibrium level
Q6: Fiscal policy refers to the
A)manipulation of the
Q7: If the government wants to increase real
Q8: If the government wants to engage in
Q9: If the government wants to engage in
Q10: If the government increases spending to move
Q11: Suppose the economy is experiencing a contractionary
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