To eliminate an inflationary gap using fiscal policy, the government could
A) increase government expenditure on goods and services and simultaneously increase taxes by an equal amount.
B) only decrease taxes.
C) increase government expenditure on goods and services and simultaneously decrease taxes by an equal amount.
D) decrease the quantity of money.
E) increase taxes.
E
You might also like to view...
Classifying a good as nonrival means
A) that there is a surplus of the good. B) that the good is produced in a competitive market. C) that the producer can prevent people from consuming it. D) that many people can consume the good simultaneously.
Scarcity arises because
A) resources are finite and are inadequate to meet all human wants. B) production of goods and services is always slow. C) companies are slow to explore for new resources. D) a large number of people live in poverty.