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ECO 336 Chapter 11 Exam 2025 Questions and Answers A common response to stop a depreciation of a currency is to use contractionary monetary policy, which could lead to a recession. - ....ANSWER ...-True Contractionary fiscal policy attempts to shift aggregate demand to the right. ....ANSWER ...-False Expansionary monetary policy is likely to lead to a depreciation of the nation's currency. - ....ANSWER ...-True Government spending and taxes - ....ANSWER ...-are a major determinant of aggregate demand. Fiscal policy is - ....ANSWER ...-the deliberate manipulation of taxation and spending designed to affect the economy. Changes in aggregate demand - ....ANSWER ...-could be caused by changes in the spending decisions of the households, businesses, the government, and foreigners. Which of the following is NOT a reason why the effects of tax cuts on government spending dissipate and each additional change in consumption and income becomes smaller and smaller? - ....ANSWER ...-Some of the increase is used for business investment. …FOR STUDENTS ONLY…©️2025 ALL RIGHTS RESERVED… 1