Day: June 25, 2022

When might the effectiveness of fiscal expansion in increasing the level of output be REDUCED?

Select ONE answer:

1. when it leads to the appreciation of the currency
2. when it results in an increase in the price of government bonds
3. when it is accompanied by an increase in the money supply
4. when the price level remains unchanged

Show your workings to arrive at your answer, and explain and justify your reasons:

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This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

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