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MMLU / Suppose the President plans to cut taxes for consumers and also plans to…

Problem

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question

Suppose the President plans to cut taxes for consumers and also plans to increase spending on the military. How does this affect real GDP and the price level?

choices

  1. GDP increases and the price level decreases.
  2. GDP decreases and the price level increases.
  3. GDP stays the same and the price level increases.
  4. GDP increases and the price level increases.

subject

high_school_macroeconomics

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Official source

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