An intended goal of contractionary fiscal policy and a tightening of monetary policy is
A) an increase in interest rates.
B) an increase in the price level.
C) a decrease in the unemployment rate.
D) a decrease in the level of aggregate output.

Question

Quizplus · Accepted Answer

Contractionary fiscal policy and a tightening of monetary policy both aim to reduce aggregate demand, which leads to a decrease in the level of aggregate output.

An Intended Goal of Contractionary Fiscal Policy and a Tightening