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Problem based on effect of fiscal policy

Problem: Determine whether each of the following would make fiscal policy more effective or less effective:

a. A decrease in the marginal propensity to consume

b. Shorter lags in the effect of fiscal policy

c. Consumers suddenly becoming more concerned about permanent income that about current income

d. More accurate measurement of the natural rate of unemployment.

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Macroeconomics: Problem based on effect of fiscal policy

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Macroeconomics: Problem based on effect of fiscal policy

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