Microeconomics Ch 34
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Keynes's theory that the interest rate adjusts to bring money supply and money demand into balance.
Theory of liquidity preferences
The setting of the level of government spending and taxation by government policymakers
The additional shifts in aggregate demand that result when expansionary fiscal policy increases income and therby increases consumer spending.
The offset in aggregate demand that results when expansionary fiscal policy raises the interest rate and thereby reduces investment spending
Changes in fiscal policy that stimulate aggregate demand when the economy goes into a recession without policymakers having to take any deliberate action.
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