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How Will a Recession End If an Economy Is Left

Question 88

Multiple Choice

How will a recession end if an economy is left to self-correct?


A) Taxes eventually will rise, which gives the government more spending power.
B) Taxes eventually will fall, which leads to an increase in aggregate demand.
C) Sticky wages eventually will fall, which allows labor markets to return to equilibrium and full employment.
D) Sticky wages eventually will rise, which leads to an increase in aggregate demand.

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