Which of the following will be observed if the U.S. federal government reduces fiscal spending, keeping other things constant?
A) The aggregate demand curve will shift to the right.
B) The aggregate expenditure in the economy will decrease.
C) The economy will approach potential GDP.
D) The marginal propensity to consume will increase.
E) The average price level will increase.
Correct Answer:
Verified
Q1: The sum of the unemployment rate and
Q2: _, the lesser will be the effect
Q5: The figure given below depicts the tax
Q7: Which of the following is not a
Q8: If the government wants to close a
Q11: Government spending equals the sum of _,
Q11: The figure given below shows the macroeconomic
Q15: Calculate the government spending multiplier if, an
Q17: Which of the following can be categorized
Q18: When the government uses taxes and spending
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents