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If, when there is full employment, the federal government increases its spending without increasing its tax revenues, generally:

1. an increase in employment will occur
2. a serious depression will occur
3. the national debts will occur
4. inflation will occur

Is choice 3 correct???

  • Economics -

    I think both 3 and 4 are correct. That said, as written, 3 is the obvious choice.

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