Explain the impact of government spending

Reference no: EM132152181

Question: What is "automatic fiscal policy" and how does it fit Keynesian fiscal policy to stimulate the economy in a recession, in terms of Government spending, taxation and budget deficits in a Demand driven economy. Use the consumption function model to explain the impact of government spending using the concepts of the Paradox of Thrift, the Multiplier effect and the role of Expectations (Consumer Confidence.)

Reference no: EM132152181

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