UNIT 05 / LONG-RUN CONSEQUENCES OF STABILIZATION POLICIES

Fiscal and Monetary Policy Actions in the Short Run5.1 test

100 questions with explanations after each answer.

Practice mode

QUESTION 01 / 100Easy

Assume the economy has a recessionary output gap. Which combination of policies would be most likely to move real output toward full employment?

Select one answerAExpansionary fiscal policy and expansionary monetary policyBContractionary fiscal policy and contractionary monetary policyCExpansionary fiscal policy and contractionary monetary policyDContractionary fiscal policy and expansionary monetary policyENo fiscal change and contractionary monetary policy

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Question 1