A Recessionary Gap Can Be Closed with

question 76

Multiple Choice

A recessionary gap can be closed with

• A) using a contractionary monetary policy.
• B) an increase in taxes.
• C) a decrease in government purchases.
• D) using an expansionary fiscal policy.

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Definitions:

Least Squares Regression

A statistical method used to determine the best-fitting line through a set of points by minimizing the sum of the squares of the vertical distances (residuals) of the points from the line.

Slope

In mathematics and statistics, the slope refers to the measure of the steepness or incline of a line, quantitively defined as the ratio of the vertical change to the horizontal change between two points on the line.

Y-Intercept

The point where a line crosses the Y-axis of a graph, representing the value of y when x is zero.

Regression Line

A straight line that best fits the data points on a scatter plot, showing the relationship between the independent and dependent variables.