1 In what circumstances would the contractionary fiscal policy be recommended? How might you implement this type of policy—what are the reasons that it might make sense to slow the economy through government policy?
2 Explain why the government budget deficit increases during a recession even without countercyclical fiscal policy.
3 Explain the differences among the three types of fiscal policy time lags. What are automatic stabilizers? Which time lags do automatic stabilizers affect?
Don’t write more than 300 words, please.
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