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Reducing the budget deficit by cutting government spending could conceivably: A. increase income if interest rates rise enough and government spending is more productive than private investment. B. decrease income if interest rates rise enough and private investment is more productive than government investment. C. increase income if interest rates fall enough and private investment is more productive than government spending. D. decrease income if interest rates fall too much and private investment is more productive than government investment.
calculation of fiscal deficit
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In 1 to 2 sentences respond to the following comment. "Pollution restrictions will reduce gross domestic product and therefore hurt the economy."
In the view of above complications, there is a long-standing debate on whether the fiscal policy should be active or passive in nature. Note that in the Keynesian context; even a p
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is/lm curve
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