Fiscal Policy

A contractionary fiscal policy can be summarized as: G↓ or T↑ ⇒ Y↓ ⇒ Md↓ ⇒ r↓ ⇒ I↑ Difficulty: M Type: A. Summarize the effects of a contractionary monetary policy where the change in the money supply (Ms) impacts upon the rate of interest (r), investment spending (I), output and income (Y), and the demand for money (Md). A ... ................
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