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Suppose the government decides to decrease taxes in an effort to increase consumer spending and investment in the economy. (a) Will this plan succeed in
Suppose the government decides to decrease taxes in an effort to increase consumer spending and investment in the economy. (a) Will this plan succeed in accomplishing both goals? (b) In equilibrium, what happens to interest rates as a result of this action? (c) Would you characterize this as a case of fiscal crowding out? Explain
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