Which of the following is an appropriate fiscal policy prescription for the government to follow?

A. Deficit reduction during a recession.
B. Deficit reduction during a war.
C. Deficit reduction when there is excess AD.
D. Deficit expansion in an inflationary gap.


Answer: C

Economics

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Scarcity is a situation in which resources are unlimited in quantity and can be used in different ways

Indicate whether the statement is true or false

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The situation in which short-term interest rates are pushed to zero, leaving the central bank unable to lower them further is known as

A) an interest rate panic. B) the Taylor rule. C) a zero-sum game. D) a liquidity trap.

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What does the complete diagram represent, the bottom half and the top half put together?

a. business cycle in general b. the factor market c. circular flow in a free market economy d. household payments for the factors of production

Economics