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If the Economy Is Falling Below Potential Real GDP, Which

Question 63

Multiple Choice

If the economy is falling below potential real GDP, which of the following would be an appropriate fiscal policy to bring the economy back to long-run aggregate supply?


A) an increase in the money supply and a decrease in interest rates
B) an increase in government purchases
C) an increase in oil prices
D) an increase in taxes
E) a decrease in the supply government services

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