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Unformatted text preview: , giving specific examples , would help move the economy back to potential output? a. A stock market boom increases the value of stocks held by households (10 points ). b. Firms come to believe that a recession in the near future is likely (10 points ). c. Anticipating the possibility of war, the government increases its purchases of military equipment (10 points ). d. The quantity of money in the economy declines and interest rates increase (10 points )....
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This note was uploaded on 05/17/2011 for the course ECONOMICS 204 taught by Professor Perti during the Spring '11 term at Kaplan University.
- Spring '11