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Dynamic AD-AS Model: Fiscal Policy
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Dynamic AD-AS Model: Fiscal Policy
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25. Dynamic AD/AS Model / Dynamic AD-AS Model: Fiscal Policy / Problem 4
Problem 4
During a recession, the government decides to implement expansionary fiscal policy. Which of the following actions would directly increase aggregate demand?
A
Increasing government spending on infrastructure projects.
B
Reducing government subsidies for renewable energy.
C
Increasing taxes on luxury goods.
D
Raising interest rates to encourage savings.
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