When Parliament Reduces Spending in Order to Balance the Budget

question 65

Multiple Choice

When Parliament reduces spending in order to balance the budget, which of the following does it need to consider?

• A)both the short-run effects on aggregate demand and aggregate supply and the long-run effects on saving and growth
• B)only the short-run effects on aggregate demand and aggregate supply
• C)only the long-run effects on saving and growth
• D)the long-run effects on aggregate demand and aggregate supply