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What factors could cause the short-run aggregate supply curve to shift to the right in the dynamic AD-AS model?
What is potential GDP in the context of the dynamic AD-AS model?
Why might a government choose to cut taxes as part of an expansionary fiscal policy during a recession?
During a recession, the government decides to implement expansionary fiscal policy. Which of the following actions would directly increase aggregate demand?
What are the potential risks of using contractionary fiscal policy during a period of economic growth?
Under what conditions is fiscal policy typically used to maintain long-run equilibrium?
If the economy's aggregate demand is \$200 billion below potential GDP, what fiscal policy action could help achieve equilibrium?
If the economy is in a recession and the current aggregate demand is \$500 billion below the potential GDP, what fiscal policy action could help achieve long-run equilibrium?
A government decides to cut taxes during a recession. How is this likely to affect the economy according to the dynamic AD-AS model?
What is the expected outcome of implementing contractionary fiscal policy in an overheated economy?