QuestionAugust 18, 2025

Government spending goes up while taxes remain the same. contractionary expansionary

Government spending goes up while taxes remain the same. contractionary expansionary
Government spending goes up while taxes remain the same.
contractionary
expansionary

Solution
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Answer

expansionary Explanation 1. Identify the Type of Fiscal Policy Government spending increases while taxes remain unchanged, leading to an increase in aggregate demand. 2. Determine the Effect on the Economy Increased government spending without a change in taxes typically stimulates economic growth.

Explanation

1. Identify the Type of Fiscal Policy<br /> Government spending increases while taxes remain unchanged, leading to an increase in aggregate demand.<br />2. Determine the Effect on the Economy<br /> Increased government spending without a change in taxes typically stimulates economic growth.
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