According to Traditional Keynesian Analysis,if the Economy Is in a Recession,the

question 3

Multiple Choice

According to traditional Keynesian analysis,if the economy is in a recession,the government can move it back towards full employment by

• A)cutting taxes and increasing expenditures.The effect of the tax cut is larger.
• B)cutting taxes and increasing expenditures.The effect of the tax cut is smaller.
• C)raising taxes and decreasing expenditures.The effect of the tax increase is larger.
• D)raising taxes and decreasing expenditures.The effect of the tax increase is smaller.

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Definitions:

Poverty Line

The fundamental amount of income necessary to afford a proper standard of living in a given nation.

Steadily Increased

A consistent and continuous rise in the level, amount, or value of a certain metric or entity over time.

Fluctuated

Describes a process or value that has experienced changes, typically up and down, over a period of time.

Income Inequality

An imbalanced dispersion of income among participants in an economy on a household or individual basis.