How Could an Expansionary Fiscal Policy Increase Real GDP and Lower

question 109

Multiple Choice

How could an expansionary fiscal policy increase real GDP and lower the price level?

• A)if aggregate supply decreases more than aggregate demand decreases
• B)if aggregate supply decreases more than aggregate demand increases
• C)if aggregate supply increases more than aggregate demand increases
• D)if aggregate supply decreases less than aggregate demand decreases
• E)if the aggregate supply increases equals the aggregate demand increase

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Definitions:

Dominant Responses

The most common or likely reactions individuals exhibit in a given situation, often influenced by past experiences, instincts, or social norms.

Nondominant Responses

Reactions or actions that are not the most common or typical in a given situation, often requiring more cognitive effort.

Productivity

The measure of the efficiency of a person, machine, system, etc., in converting inputs into useful outputs.

Nominal Group Technique

A structured method for group brainstorming that encourages contributions from everyone.