The proper government response to recession

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Reference no: EM131376442

1. In the Austrian pure free market, a nation with a low savings rate will have _______ interest rates and _______ levels of investment.

A) low; high B) high; high C) low; low D) high; low

2. According to Keynesian analysis; the proper government response to a recession is _________, whereas an Austrian would support __________.

A) the implemention of a corporatist bailout of insolvent firms; raising taxes

B) expansionary fiscal policy; expansionary monetary policy

C) increasing government spending; increasing the legal powers of the central bank to deal with the crisis

D) expansionary fiscal/monetary policy; laissez-faire.

Reference no: EM131376442

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