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20. Fiscal Policy
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Problem 9
Problem 10
Problem 11
Problem 12
20. Fiscal Policy
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20. Fiscal Policy / Criticisms of Fiscal Policy / Problem 11
Problem 11
Why are state and local fiscal policies often procyclical during economic downturns?
A
State and local governments are required to maintain balanced budgets.
B
State and local governments increase spending during downturns.
C
State and local governments have more flexibility in borrowing than the federal government.
D
State and local governments receive more federal aid during downturns.
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