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Need some help with the following questions, thanks! Complete the following sentence explaining how discretionary fiscal policy fights inflation. in government spending to stimulate a
Need some help with the following questions, thanks!
Complete the following sentence explaining how discretionary fiscal policy fights inflation. in government spending to stimulate a V shift of the curve returns the economy to full employment.In the following table, indicate the effect of each scenario on the aggregate demand curve. Scenario Change in Aggregate Demand Government spending decreases. The amount of taxes collected decreases.For each scenario in the following table, indicate whether the fiscal policy is expansionary, contractionary, or neutral. Scenario Expansionary Contractionary Neutral The government decreases spending. O O O The government increases taxes. O O O The government increases spending and taxes by an equal amount. O O OWhy does a reduction in taxes have a smaller multiplier effect than an increase in government spending of an equal amount? 0 A tax cut directly injects zero new spending into the economy because the government has purchased no new goods and services. 0 An increase in government spending doubles initiallyr because the government spends the entire tax revenue on new goods and servicesStep by Step Solution
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