A fiscal policy action to close a recessionary gap is to A increase taxes B

A fiscal policy action to close a recessionary gap is

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134.A fiscal policy action to close a recessionary gap is to: A. increase taxes. B. decrease transfer payments. C.increase government purchases. D. increase the marginal propensity to consume. AACSB: Analytical Skills Blooms: Knowledge Frank - Chapter 21 #134 Learning Objective: 21-04 Show how a change in planned aggregate expenditure can cause a change in short-run equilibrium output and how this is related to the income expenditure multiplier. Section: Stabilizing Planned Spending: The Role of Fiscal Policy
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135.A fiscal policy action to close an expansionary gap is to: AACSB: Analytical Skills Blooms: Knowledge Frank - Chapter 21 #135 Learning Objective: 21-04 Show how a change in planned aggregate expenditure can cause a change in short-run equilibrium output and how this is related to the income expenditure multiplier. Section: Stabilizing Planned Spending: The Role of Fiscal Policy
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136.If short-run equilibrium output equals 20,000 and potential output (Y*) equals 25,000, then this economy has a(n) __________ gap that can be closed by _________. AACSB: Analytical Skills Blooms: Application Frank - Chapter 21 #136 Learning Objective: 21-04 Show how a change in planned aggregate expenditure can cause a change in short-run equilibrium output and how this is related to the income expenditure multiplier. Section: Stabilizing Planned Spending: The Role of Fiscal Policy
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137.If short-run equilibrium output equals 20,000 and potential output (Y*) equals 15,000, then this economy has a(n) __________ gap that can be closed by _________. AACSB: Analytical Skills Blooms: Application Frank - Chapter 21 #137 Learning Objective: 21-04 Show how a change in planned aggregate expenditure can cause a change in short-run equilibrium output and how this is related to the income expenditure multiplier. Section: Stabilizing Planned Spending: The Role of Fiscal Policy
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138.If short-run equilibrium output equals 50,000 and potential output (Y*) equals 45,000, then this economy has a(n) __________ gap that can be closed by _________. A. expansionary; decreasing taxes B. expansionary; increasing transfer payments C.expansionary; decreasing government purchases D. recessionary; increasing government purchases AACSB: Analytical Skills Blooms: Application Frank - Chapter 21 #138 Learning Objective: 21-04 Show how a change in planned aggregate expenditure can cause a change in short-run equilibrium output and how this is related to the income expenditure multiplier.
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