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Question:
The Keynesian view suggests that the government can reduce aggregate demand by using:
A
restrictive fiscal policy to shift the government budget toward a surplus (or smaller deficit).
explanation
According to the Keynesians, policymakers can use the budget to diminish aggregate demand through restrictive fiscal policy. Reducing government expenditures and/or increasing tax rates should lead to a decline in the expected size of the budget deficit or an increase in the budget surplus.
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