Suppose the Economy Is in an Equilibrium in Which Real

question 107

Multiple Choice

Suppose the economy is in an equilibrium in which real GDP is less than potential GDP.To increase real GDP,the government can use a fiscal stimulus of

• A)increasing taxes only.
• B)decreasing government expenditure only.
• C)decreasing taxes and/or increasing government expenditure.
• D)decreasing government expenditure and simultaneously increasing taxes.
• E)increasing the quantity of money.

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Definitions:

Recall

The act of retrieving information or memories from one's past mental store without being explicitly cued or prompted.

Essay Tests

Essay tests are examination formats that require test-takers to construct written responses to open-ended questions, often assessing their comprehension, analysis, and synthesis skills.

Nonsense Syllables

Meaningless sets of two consonants, with a vowel sandwiched in between, that are used to study memory.

Memory Study

The scientific research focused on understanding how memory works, including processes of encoding, storing, and retrieving information.