Multiple Choice
Suppose the economy is in long-run equilibrium. If the federal government cuts government
Spending, which of the following is likely to result?
A) an increase in real GDP and an increase in the price level
B) an increase in unemployment and an increase in the price level
C) a decrease in unemployment and a decrease in the price level
D) a decrease in the price level and an increase in unemployment
Correct Answer:
Verified
Correct Answer:
Verified
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