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Money supply or government expenditures

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Reference no: EM131309374

Determine whether the following statement is TRUE or FALSE then EXPLAIN why.

1. In principle the government could increase the money supply or government expenditures to try to offset rising unemployment.

2. If the CPI rises at 5% per year, then every individual in the country needs exactly a 5% increase in their income for their standard of living to remain constant.

Reference no: EM131309374

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