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15-2 Vocabulary jw

QuestionAnswer
States that aggreage demand needs to be stimulated by government action. Keynesian economics
A plan to stimulate aggregate demand. Demand-side fiscal policy
States that a small change in spending causes a much larger change in GDP. Spending Multiplier Effect
Provides incentives to producers to increase aggregate supply. Supply-side fiscal policy
A graph that illustrates the economist Arthur Laffer's theory of how tax cuts affect tax revenues. Laffer Curve
Created by: joannw15
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