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    Exam 25: Spending and Output in the Short Run
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    In the Basic Keynesian Model, a Decrease in Transfer Payments
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In the Basic Keynesian Model, a Decrease in Transfer Payments

Question 75

Question 75

Multiple Choice

In the basic Keynesian model, a decrease in transfer payments:


A) reduces short-run equilibrium output.
B) increases short-run equilibrium output.
C) reduces potential output.
D) increases potential output.

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