Question 1 In an aggregate demand-aggregate supply diagram, equal increases in government spending and taxes will cause: O decrease in the equilibrium GDP. shift the AD curve to the right. not affect the AD curve. shift the AD curve to the left. Question 2 The set of fiscal policies that would be most expansionary: Decrease in government spending and an increase in taxes Increase in both government spending and taxes Increase in government spending and a decrease in taxes Decrease in both government spending and taxes Question 3 A Federal budget deficit exists when: O Federal government assets are less than liabilities O Federal government spending is increasing Federal government taxation is decreasing O Federal government spending exceeds tax revenues 2 pts 2 pts 2 pts
Question 1 In an aggregate demand-aggregate supply diagram, equal increases in government spending and taxes will cause: O decrease in the equilibrium GDP. shift the AD curve to the right. not affect the AD curve. shift the AD curve to the left. Question 2 The set of fiscal policies that would be most expansionary: Decrease in government spending and an increase in taxes Increase in both government spending and taxes Increase in government spending and a decrease in taxes Decrease in both government spending and taxes Question 3 A Federal budget deficit exists when: O Federal government assets are less than liabilities O Federal government spending is increasing Federal government taxation is decreasing O Federal government spending exceeds tax revenues 2 pts 2 pts 2 pts
Chapter24: Fiscal Policy
Section: Chapter Questions
Problem 5P
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