The Model Predicts That a Temporary Decrease in Government Expenditures

question 52

Multiple Choice

The model predicts that a temporary decrease in government expenditures will lead to:

• A)an increase in real wages.
• B)a decrease in the real interest rate.
• C)a decrease in GDP.
• D)none of the above.

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Definitions:

Tax Deductible

Expenses that can be subtracted from one's gross income, reducing taxable income and the amount of tax owed.

Hand Gestures

Movements of the hands and arms used to convey ideas or messages, often accompanying speech or as a form of non-verbal communication.

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An outlook that focuses on the good in situations or expectations of positive outcomes.

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