a) Economies such as Canada are characterized by:

economic stability

persistent full employment

zero inflation

uninterrupted economic growth

instability of employment and price levels

b)Taxes represent a(n):

injection of purchasing power, like investment

withdrawal of purchasing power, like investment

withdrawal and an injection of purchasing power, like both saving and investment

withdrawal of purchasing power, like saving

injection of purchasing power, like saving

c) Which of the following would be the most contractionary?

$20 billion increases in both government purchases and taxes

a $20 billion decrease in taxes

a $20 billion increase in taxes

a $20 billion decrease in government purchases

$20 billion decreases in both government purchases and taxes