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Both Japan and Canada Experienced a Severe Economic Slowdown During

Question 10

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Both Japan and Canada experienced a severe economic slowdown during the 1990s.The fiscal policy responses of the two countries were


A) virtually the same: both substantially increased government spending and ran large budget deficits.
B) virtually the same: both reduced government spending as a share of the economy and shifted the budget toward a surplus.
C) dramatically different: Japan sharply increased government spending and ran large budget deficits,while Canada reduced government spending as a share of the economy and shifted the budget toward a surplus.
D) dramatically different: Japan reduced government spending as a share of the economy and shifted the budget toward a surplus,while Canada increased government spending and ran large budget deficits.

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