An Expansionary Fiscal Policy Is Likely to

question 145

Multiple Choice

An expansionary fiscal policy is likely to

• A) decrease a government budget surplus (or increase a budget deficit) and increase borrowing by the Treasury which will sell more bonds.
• B) increase a government budget surplus (or increase a budget deficit) and decrease borrowing by the Treasury which will buy more bonds.
• C) increase a government budget surplus (or increase a budget deficit) and increase borrowing by the Treasury which will sell more bonds.
• D) decrease a government budget surplus (or increase a budget deficit) and decrease borrowing by the Treasury which will buy more bonds.

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