Suppose because of a recession, most state governments experience reductions in tax revenues, and respond by reducing
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Suppose because of a recession, most state governments experience reductions in tax revenues, and respond by reducing their expenditures and increasing their taxes to keep their state budgets in balance (a constitutional requirement in many U.S. states). Will this have any effect on the recession, and if so, what?
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This policy on the part of states deepens the recession In a recessi...View the full answer
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