Author Question: An increase in government spending will have the greatest expansionary impact on the economy if it ... (Read 52 times)

melly21297 · **on:** Jun 30, 2018

An increase in government spending will have the greatest expansionary impact on the economy if it is combined with:
a. an increase in tax revenue equal to the increase in spending.
b. a decrease in tax revenue equal to the increase in spending.
c. unchanged tax revenue.
d. none of these is true.

Question 2

A decrease in the supply of money, other things being equal, will raise the equilibrium interest rate.
a. True
b. False
Indicate whether the statement is true or false