A country is in the midst of a recession. If the government successfully pursues expansionary fiscal policy then in the long run we would expect the price level to ______. If the government does not pursue expansionary fiscal policy then in the long run we would expect the price level to ______.
Answers can be increase, decrease or same
The words that best fills the given blanks in the statement would be "decrease" and "decrease" respectively. Implementing fiscal policies has been one of the precautionary measures done by a government to resolve the issues in inflation. In addition, these policies would tend to decrease the price levels in an economy.
