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MMLU / Which of the following fiscal policy combinations would be most likely to slowly…

Problem

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question

Which of the following fiscal policy combinations would be most likely to slowly increase real GDP without putting tremendous upward pressure on the price level?

choices

  1. Increase government spending with a matching decrease in taxes.
  2. Decrease government spending with a matching increase in taxes.
  3. Increase government spending with no change in taxes.
  4. Increase taxes with a matching increase in government spending.

subject

high_school_macroeconomics

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Official source

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