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The economy is in a boom and the inflationary gap is large

The economy is in a boom and the inflationary gap is large.

a. Describe the discretionary and automatic fiscal policy actions that might occur.

b. Describe a discretionary fiscal restraint package that could be used that would not produce serious negative supply-side effects.

c. Explain the risks of discretionary fiscal policy in this situation.

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Business Management: The economy is in a boom and the inflationary gap is large

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Business Management: The economy is in a boom and the inflationary gap is large

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