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Suppose the Economy Is Initially Operating at Full Employment

question 21

Multiple Choice

Suppose the economy is initially operating at full employment. A fiscal policy action that results in an increase in the size of the budget deficit will cause which of the following in the long run?


Definitions:

Service Revenue

Income earned by a company for the services it has provided to its customers.

Bank Loan Payable

Bank Loan Payable is the amount owed by a borrower to a bank, typically represented as a liability on the borrower's balance sheet.

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