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a)Using the short-hand symbols G, Y, Md, r and I to demonstrate the effects of an expansionary fiscal policy.

Macroeconomics

13th Edition

ISBN:9781337617390

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter18: Debates In Macroeconomics Over The Rolse And Effects Of Government

Section: Chapter Questions

Problem 7QP

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a)Using the short-hand symbols G, Y, Md, r and I to demonstrate the effects of an expansionary fiscal policy.

b)Using the short-hand symbols Ms, r, I, Y, and Md to demonstrate the effects of an expansionary monetary policy.

c)Using the short-hand symbols, explain the effects of a contractionary fiscal policy and a contractionary monetary policy.

Definition Definition Policy implemented by the central bank of a country (such as the Federal Reserve in the United States) to achieve certain macroeconomic objectives. Monetary policy is a supply-side macroeconomic policy that supervises the growth rate and money supply in the economy.

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