ECON MACRO
5th Edition
ISBN: 9781337000529
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 11, Problem 1.8P
To determine
The economy with an expansionary gap.
Concept Introduction:
Fiscal Policy: Fiscal policy is the policy by which government regulates the nation’s economy by adjusting the government spending and controlling the tax rates. It tries to influence the
Recessionary Gap: Recessionary Gap is the gap between actual output and potential output under full employment situation when actual output is less than potential output.
Expansionary Gap: Expansionary Gap is the gap between actual output and potential output under full employment situation when actual output is more than potential output.
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