Of the following, identify the incorrect statement. a. Output gaps are caused by inflationary pressures generated by
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a. Output gaps are caused by inflationary pressures generated by the unintended side effects of government policy.
b. A low aggregate spending can make output to fall below potential output.
c. When spending is high, output may rise above potential output.
d. Government policies can help to eliminate output gaps.
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When actual output is lower than its potential there exists an output gap kno...View the full answer
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