Which of these is NOT a measure to correct excess demand?

Raising government spendingCorrect answerYour answerRaising taxesCorrect answerYour answerRaising the repo rateCorrect answerYour answerSelling government securitiesCorrect answerYour answer

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CorrectNot quiteAnswer A

Correct answer: A

More government spending adds to AD and makes excess demand worse.

Concept: Wrong remedy
Typical timeTypical: 40 s
Your timeYours: —

The rule this testsExcess demand and the inflationary gap

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Ten questions from Excess & Deficient Demand, at your own pace.

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Which of these is NOT a measure to correct excess demand?

Explanation