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Stagflation poses a dilemma for policymakers because if a contractionary fiscal policy is used to combat inflation, equilibrium GDP will tend to rise. if an

Stagflation poses a dilemma for policymakers because
if a contractionary fiscal policy is used to combat inflation, equilibrium GDP will tend to rise.
if an expansionary fiscal policy is used to combat unemployment, the price level will tend to fall.
if an expansionary fiscal policy is used to expand the economy, the price level will tend to rise.
a contractionary fiscal policy will tend to lower both the price level and the unemployment rate.
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