and the president to stize real GDP in the ince of an economic downturn. Is it p

Question

and the president to stize real GDP in the ince of an economic downturn. Is it possible that ment acoe lags could actually cause discretionary fiscal policy to destabilize real GDP: (See page drop ment push reacl stru these time la gs you understand ons, vistan ions, videos, and 302.) Determine whether each of the following is an example of a situation in which a direct expendi- 13- 4, 13-7. Det ture offset to fiscal policy occurs. (See page 300.) exa pag a. a. In an effort to help rejuvenate the nation's rail- road system, a new government agency buys unused track, locomotives, and passenger and freight cars, many of which private companies would otherwise have purchased and put into b. regular use. MyEconLab Visit http://www.myeconlab.com to complete these exe

Explanation / Answer

Ans: option (C). Here govt is spending on that work which would not be taken by private sector. The other options shows that expenditure can be thrown on private sector and they should not be discouraged to investment.

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