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(n)
policy is employed when the government chooses to run a larger deficit
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GPT-5 mini
AI
Expansionary fiscal policy.
This means the government increases spending and/or cuts taxes (running a larger deficit) to boost aggregate demand, output, and employment. Effects can include higher GDP and inflation in the short run and larger public debt (and possible crowding out of private investment) over time.
This means the government increases spending and/or cuts taxes (running a larger deficit) to boost aggregate demand, output, and employment. Effects can include higher GDP and inflation in the short run and larger public debt (and possible crowding out of private investment) over time.
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