Contractionary Fiscal Policy Should Be Used If

question 74

Multiple Choice

Contractionary fiscal policy should be used if:

• A)aggregate demand-aggregate supply equilibrium is below potential output.
• B)aggregate demand-aggregate supply equilibrium is above potential output.
• C)aggregate demand-aggregate supply equilibrium is equal to potential output.
• D)none of the above.

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Definitions:

Ethical Principles

Fundamental beliefs or values that guide behavior and decision-making based on notions of right and wrong.

Acquaintances

Individuals one knows slightly but who are not close friends.

Political Contributions

Financial donations made by individuals or organizations to political parties or candidates to support their campaigns.

Kickbacks

The return of a portion of the money exchanged in a transaction as a secret payment, often as a bribe, for services rendered or to influence decisions.