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(a) Draw a diagram that shows the government's budget balance relative to national income. Explain briefly the vertical intercept of the budget function and its
(a) Draw a diagram that shows the government's budget balance relative to national income. Explain briefly the vertical intercept of the budget function and its slope. (b) Using your diagram from (a), show the structural budget balance and a situation in which the actual balance is different from the structural balance. (c) Based on this diagram, show and explain the difference between the budget effects of auto- matic stabilization and discretionary fiscal policy
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