When a Direct Expenditure Offset Occurs with the Implementation of an Expansionary

question 166

Multiple Choice

When a direct expenditure offset occurs with the implementation of an expansionary fiscal policy,

• A) the stimulative effect will be less than expected.
• B) the stimulative effect will be more than expected.
• C) the fiscal policy will not be discretionary.
• D) the time lags associated with the implementation of fiscal policy will shorten.

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