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How government policies can influence economic growth?

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Monetary and fiscal policy are used to regulate the economy, economic growth, and inflation so that long-run growth is possible. Government activities used to improve long-run growth include stimulating economic growth, enacting monetary policies, fixing the exchange rates, and using wage and price controls. read more

If there is spare capacity (negative output gap) then demand side policies can play a role in increasing the rate of economic growth. However, if the economy is already close to full capacity (trend rate of growth) a further increase in AD will mainly cause inflation. read more

Discuss how government policies can influence economic growth. Government policies can influence economics growth in multiple ways. One of the influences can involve monetary policies. Monetary policies can be the most common tool for influencing the economic growth. read more

GDP growth will be about 2½ percent, with the level of GDP remaining well below its potential. Fiscal Policy Options for Increasing Economic Growth and Employment in 2012 and 2013 One criterion for evaluating fiscal policy options is the impact on the economy per dollar of budgetary cost. read more

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3.4 Demand And Supply Side Policies
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