In 2015, the Canadian government intended to adopt a balance budget act requiring the government to maintain
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In 2015, the Canadian government intended to adopt a balance budget act requiring the government to maintain a balanced budget at all times. Hence, if the government wishes to change government spending, it will always have to change the taxes by the same amount, that is, G = T. Does this law imply that the government can no longer use fiscal policy to affect employment and output?
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Answer The adoption of a balanced budget act where government spending G is required to be equal to taxes T at all times GT has implications for fisca...View the full answer
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Related Book For 
International Economics Theory And Policy
ISBN: 9781292409719
12th Edition
Authors: Paul Krugman , Maurice Obstfeld, Marc Melitz
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