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Need help solving 5&6
, expansionary fiscal policy is most likely to crowd out private spending. the unemployment rate is 15% aggregate income is $500 billion above its potential level aggregate income is $800 billion below its potential level aggregate output is $300 billion below its potential level 6. If A) B) C) D)
5. Expansionary fiscal policy shifts the aggregate demand curve to the and is used to close a(n) gp A) right;inflationary B) right; recessionary C) left; inflationary D) left, recessionary
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6. Correct option: D) aggregate output is $300 billion below its potential level. Reason: In the AD-AD model, when aggregate

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