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QUESTION

. What are government's fiscal policy options for moving the economy out of a recession?

. What are government’s fiscal policy options for moving the economy out of a recession? Speculate on which of these fiscal options might be favored by (a) a person who wants to preserve the size of government and (b) a person who thinks the public sector is too large. How does the “ratchet effect” affect anti-inflationary fiscal policy?

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