Objective:
Warm-up:
- What are two expansionary fiscal policies the government of Freelandia could use?
- Define the multiplier effect.
- Which policy is likely to have the largest impact on Freelandia's GDP, based on your understanding of the multiplier effect?
- Is Freelandia likely to experience a multiplier effect if its government implements the policy suggested in question 3. Explain.
Homework:
Answer Questions 1-4
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