Multiple Choice
If the economy is falling below potential real GDP,which of the following would be an appropriate fiscal policy to bring the economy back to long-run aggregate supply? An increase in
A) the money supply and a decrease in interest rates.
B) government purchases.
C) oil prices.
D) taxes.
Correct Answer:

Verified
Correct Answer:
Verified
Q146: Fiscal policy is determined by<br>A)the Federal Reserve.<br>B)the
Q147: Federal government expenditures as a percentage of
Q148: Contractionary fiscal policy is used to decrease
Q149: Crowding out,following an increase in government spending,results
Q150: Of the $840 billion American Recovery and
Q152: Increasing the federal budget deficit will contribute
Q153: Suppose real GDP is $13 trillion and
Q154: Cutting taxes<br>A)will lower disposable income and lower
Q155: During most of the years of the
Q156: The increase in the amount that the