Recession Growth Increasing government spending Decreasing government spending Decreasing taxes Increasing taxes Increasing the federal budget surplus Increasing the federal budget deficit Recession Growth Decreasing government spending Increasing government spending Increasing taxes Increasing the federal budget deficit Decreasing taxes Increasing the federal budget surplus
Recession Growth Increasing government spending Decreasing government spending Decreasing taxes Increasing taxes Increasing the federal budget surplus Increasing the federal budget deficit Recession Growth Decreasing government spending Increasing government spending Increasing taxes Increasing the federal budget deficit Decreasing taxes Increasing the federal budget surplus
Chapter11: Fiscal Policy
Section: Chapter Questions
Problem 19E
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Question
Ruritania's economy has been enjoying positive but slowing growth. The Ministry of Economics is considering various policy measures. Place each option in the appropriate column according to whether it will most likely lead Ruritania on a business cycle path towards continued growth or into a recession.
Options:
Increase government spending.
Decrease government spending.
Increase taxes.
Decrease taxes.
Increasing the federal budget deficit.
Increasing the federal budget surplus.
Already tried the combinations in the attached pictures and got them wrong.
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