If an Economy Is in an Equilibrium with an Inflationary

question 87

Multiple Choice

If an economy is in an equilibrium with an inflationary gap, policy-makers can use

• A) discretionary fiscal policy and increase government expenditure.
• B) automatic fiscal policy and increase government expenditure.
• C) automatic fiscal policy and cut taxes.
• D) discretionary fiscal policy and decrease government expenditure.
• E) discretionary fiscal policy and cut taxes.

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Definitions:

Reproductive Class

A category or grouping within a species based on reproductive roles or capabilities, such as gender or capability to reproduce.

Pre-Reproductive

Individuals in a population who have not yet reached the age where they are capable of producing offspring, contributing to the population's growth potential.

Demographic Transition

Due to industrialization, a decline in the birthrate following a reduction in the death rate so that the population growth rate is lowered.

Birthrate

A measure of population growth or decline, calculated as the number of live births per 1,000 people per year.