In a Binding Situation, a Decrease in Government Spending

question 86

Multiple Choice

In a binding situation, a decrease in government spending

• A) shifts the AD curve to the right.
• B) shifts the AD curve to the left.
• C) does not shift the AD curve.
• D) causes the AD curve to become horizontal.

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Definitions:

Policy Evaluation

A detailed examination of the results, effectiveness, and efficiency of a policy after its implementation.

Outcome Criteria

Standards or benchmarks used to evaluate the effectiveness or success of a program, activity, or intervention.

Cost Reductions

Measures or strategies implemented to decrease the expenses incurred by a business, government, or individual.

Barrier

An obstacle or hindrance that prevents progress or access, which can be physical, psychological, or systemic in nature.