To raise GDP, which of the following might the government do? Contractionary Fiscal Policy lower individual tax rates cause...

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Economics

To raise GDP, which of the following might the governmentdo?
Contractionary Fiscal Policy
lower individual tax rates
cause AD to shift left
decrease Govt spending
If AD is shifting left, which of the following is likelyoccurring?
Expansionary Fiscal Policy
Inflation
Contractionary Fiscal Policy
increasing GDP
If our economy is experiencing an expansionary gap, which of thefollowing would be the likely response by our govt?
increase AD
lowering corporate taxes
Expansionary Fiscal Policy
actions that would cause AD to shift left

Answer & Explanation Solved by verified expert

4.4 Ratings (541 Votes)

Q1 GDP C I G NX AD In order to increase the GDP the AD curve must be shifted to its right This can be achieved by adopting expansionary fiscal policy such as introducing tax cuts increasing government See Answer

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	Contractionary Fiscal Policy
	lower individual tax rates
	cause AD to shift left
	decrease Govt spending

	Expansionary Fiscal Policy
	Inflation
	Contractionary Fiscal Policy
	increasing GDP

	increase AD
	lowering corporate taxes
	Expansionary Fiscal Policy
	actions that would cause AD to shift left