In the Smets-Wouters DSGE Model, an Increase in Government Spending

question 71

Multiple Choice

In the Smets-Wouters DSGE model, an increase in government spending will cause:
i. Real GDP to rise
ii. Consumption to fall
iii. Inflation to rise

• A) i and ii
• B) i, ii, and iii
• C) iii
• D) i
• E) ii

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Definitions:

SAD

Seasonal Affective Disorder, a type of depression that occurs at a specific time of year, usually during winter, when there is less natural sunlight.

GAD

Generalized Anxiety Disorder, a mental health condition characterized by excessive, uncontrollable worry about everyday matters.

Conduct Disorder

A serious behavioral and emotional disorder in children and adolescents marked by a persistent pattern of violating the rights of others or major societal norms or rules.

Treatment

Interventions or procedures aimed at relieving or healing a disorder, disease, or medical condition.