Is this measure stabilizing or destabilizing

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1. Some states are required to balance their budgets. Is this measure stabilizing or destabilizing? Suppose all states were committed to a balanced-budget philosophy and the economy moved into a recession. What effects would this philosophy have on the size of the federal deficit?

2. Explain why stabilization policy may be difficult to carry out. How is it possible that stabilization policies can actually be destabilizing?

Reference no: EM131302570

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