Business Cycles
AP Macroeconomics · Flashcards · Recall
AP MACROECONOMICS · FLASHCARDS
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QUESTION
What is the primary goal of expansionary monetary policy?
QUESTION
What is the purpose of fiscal policy in stabilizing business cycles?
QUESTION
What is the effect of a contractionary fiscal policy?
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ANSWER
It reduces aggregate demand and slows economic growth. Reduced spending and higher taxes slow economic activity.
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