Increases in Government Expenditures and Large Budget Deficits Are Projected

question 171

Multiple Choice

Increases in government expenditures and large budget deficits are projected for 2010-2019.The crowding-out and new classical views indicate this fiscal policy will lead to

• A)lower interest rates and tax rates that will enhance economic growth.
• B)higher interest rates and tax rates that will slow economic growth.
• C)increases in aggregate demand that will lead to strong economic growth.
• D)high rates of future inflation.

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Definitions:

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Middle-Class Educated

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