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From course:

Economics A Level (DONEEEEEEE)

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Question:

How can Government Spending [Fiscal Policy] influence AD?

Author: eric_galvao



Answer:

-If AD is Low, and Economic Growth isn’t High as well, then Government will Overspend to Increase AD and have Economic Growth -If AD is High, and the Economy is Booming, then the Government will impose Higher Taxes and Spend Less to Reduce AD and slow down the Economic Growth


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