Saturday, November 12, 2011

Please help me with this Macro Economics question?

1, 2 and 3 would likely are the right answers. It's hard to know and predict the inflation and recession correctly. Most of them have been delayed by at least 6 months. That make the fiscal policy instrument either too late or too early. Budget deficits, government spending have to p Congress, it might take months. And for sure, people will be in panic,if the government wil raise taxes. In some countries, the governments do collapse due to the tax issues. But I think fiscal policy is well-known to our politicians.

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