SQ1,2 and 3 Ir Q1. How does each of the following affect the aggregate demand curve? a} The amount of taxes collected decreases. b] Government spending decreases. c] A so-called 'balanced-budget' increase in government spending whereby the amount of taxes collected also increases by the same amount as the government spending. b Q2. Explain the role that the spending multiplier plays in demandside discretionary fiscal policy. F Q3. Which policy is more contractionary: a 5 1 00 billion cut in government spending for goods and services or a $100 billion increase in taxes? Explain your answe