What would be appropriate government action to close an inflationary gap? Multiple Choice Use policy to decrease aggregate supply. Use policy to decrease potential GDP О Use counter-cyclical fiscal policy to decrease aggregate demand. О Use counter-cyclical fiscal policy to increase aggregate demand.
What would be appropriate government action to close an inflationary gap? Multiple Choice Use policy to decrease aggregate supply. Use policy to decrease potential GDP О Use counter-cyclical fiscal policy to decrease aggregate demand. О Use counter-cyclical fiscal policy to increase aggregate demand.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:What would be appropriate government action to close an inflationary gap?
Multiple Choice
Use policy to decrease aggregate supply.
Use policy to decrease potential GDP
Transcribed Image Text:О
Use counter-cyclical fiscal policy to decrease aggregate demand.
О
Use counter-cyclical fiscal policy to increase aggregate demand.
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