Figure 12-3 -Refer to Figure 12-3. If the Aggregate Demand Curve Is

question 101

Multiple Choice

Figure 12-3
-Refer to Figure 12-3. If the aggregate demand curve is AD₀, which of the following is the most
Appropriate discretionary fiscal policy to pursue?

• A) increase government spending, increase individual income tax rates, and increase corporate income tax rates
• B) increase government spending, increase individual income tax rates, and decrease corporate income tax rates
• C) increase government spending, decrease individual income tax rates, and decrease corporate income tax rates
• D) maintain existing government spending, individual income tax rates, and corporate income tax rates

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