The Long-Run Effects of an Increase in Government Purchases Are

question 51

Multiple Choice

The long-run effects of an increase in government purchases are that interest rates will ____, inflation will ____, and real GDP will ____.

• A)decrease; decrease; remain unchanged
• B)increase; increase; remain unchanged
• C)remain unchanged; increase; remain unchanged
• D)increase; increase; increase
• E)decrease; increase; remain unchanged

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