Question 17 2.5 pts The federal government funds deficit spending by: issuing bonds. redeeming bonds increasing taxes providing and selling government services. D Question 18 2.5 pts Which of the following statements is not true? A decrease in federal income tax rates is an example of fiscal policy that affects GDP through consumption adjustments. Automatic stabilizers act to moderate business cycles primarily through the personal income and consumption channels. Other things equal, the steeper the slope of the aggregate supply curve, the less effective will be the expansionary fiscal policy. When aggregate expenditure (A) exceed Real GDP, inventory levels rise unexpectedly, which sends a signal to firms that they have overproduced, so they cut back on production. D Question 19 2.5 pts Other things being equal, which of the following will increase aggregate expenditures? An increase in domestic prices relative to foreign prices O A decrease in the interest rate A decrease in real wealth An increase in income taxes O A decrease in government purchases of goods and services