(See related pages)
After reading this chapter you should be able to
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Understand discretionary and nondiscretionary fiscal policy and how the aggregate supply and aggregate demand model can be used to demonstrate how they work. |
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Distinguish between aggregate demand and aggregate supply shocks. |
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See that there are considerable problems associated with discretionary fiscal policy but that nondiscretionary fiscal policy is a mainstay of our current macroeconomic system. |