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Which of the Following Fiscal Policy Changes Would Be the Most

Question 250

Multiple Choice

Which of the following fiscal policy changes would be the most contractionary?


A) a $40 billion increase in taxes
B) a $10 billion increase in taxes and a $30 billion cut in government spending
C) a $20 billion increase in taxes and a $20 billion cut in government spending
D) a $30 billion increase in taxes and a $10 billion cut in government spending

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