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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

List the areas where government policy can help economic growth.

To determine

To write: about the areas that government policies can impact to help with the economic growth.

Explanation

Under fiscal policies the government can modify its expenditure level and affect the aggregate demand directly. Alternatively, it can alter the tax rate to change the disposable income and thereby affect the consumption expenditure of household. This way it can influence the aggregate demand in an indirect manner through changing the consumption demand. For promotion of growth, government can further create human capital through public education system, develop infrastructural facilities by funding infrastructure projects...

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