Friedman’s analysis indicates that a consequence of increased government spending is a. a larger deficit which...
Friedman’s analysis indicates that a consequence of increased government spending is
a. a larger deficit which would require more government borrowing.
b. inflation.
c. crowding out.
d. All of the above.
e. None of the above.
Homework Answers
Solution: All of the above.
Explanation: Friedman’s analysis indicates that that the expansionary impacts of a rise government spending are partially offset by an accompanying rise in interest rates; thus results to an inflation. It argues that it can be an accurate and a responsive counter balance to instability in an economy of a country. According to him, it can result to a huge deficit which would require more government borrowing
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Friedman’s analysis indicates that a consequence of increased
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