According to New Classical Economics, Fiscal Policy Can Change Equilibrium

question 87

True/False

According to new classical economics, fiscal policy can change equilibrium real GDP only if it changes the price level or one of the determinants of aggregate supply, and people expect this change.

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Definitions:

Active Listening

involves fully concentrating, understanding, responding, and remembering what is being said in a conversation.

Understood

Generally recognized or comprehended by people.

Defensive Feedback

Responses to criticism or suggestions that are aimed at protecting oneself from perceived attack rather than absorbing the information constructively.

Dialogue

A conversation between two or more people as a feature of a book, play, or movie, or as a means of communication.