Author Question: Which of the following statements is true of government spending? a. An increase in government ... (Read 86 times)

magmichele12 · **on:** Jun 30, 2018

Which of the following statements is true of government spending?
a. An increase in government spending raises the equilibrium level of income by a multiple of the original spending increase.
b. Government spending is a part of monetary policy, not fiscal policy.
c. A decline in government spending brings about an expansion in the economy.
d. An increase in government spending increases the recessionary gap in the economy.
e. An increase in government spending shifts the aggregate demand curve downward by a fraction of the rise in government spending.

Question 2

Along a supply curve:
a. supply changes as price changes.
b. quantity supplied changes as price changes.
c. supply changes as technology changes.
d. quantity supplied changes as technology changes.