Define the standardized budget, explain its significance, and state why it may differ from the actual budget.
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Built-in stability
If the economy is operating at GDP 2, instead of GDP 3, what is the status of its standardized budget? The status of its current fiscal policy? What change in fiscal policy would you recommend? How would you accomplish that in terms of the G and T lines in the figure?
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Related Book For
Economics
ISBN: 978-0073375694
18th edition
Authors: Campbell R. McConnell, Stanley L. Brue, Sean M. Flynn
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