Explain the pros and cons of the self correcting economy
Course:- Business Economics
Reference No.:- EM13833177

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Rather than the short run effects of decreasing government spending, allow a self correcting economy to bring the model back to equilibrium, the government decides to act to eliminate the output gap through monetary policy. Explain how the government would do this and the impact on your graph. Explain the pros and cons of the self correcting economy in this case.

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