Increased fiscal deficit leads to:
A. Increase in government spending
B. Increase in domestic interest rate
C. Fall in private investment
D. Fall in total borrowing by the government
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UGC-NET 2025 Question 50: Fiscal and monetary policy effectiveness
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Fiscal and monetary policy effectiveness has come up 30 times in 7 exams since 2010.
What this question tests
This question is on Relative effectiveness of fiscal and monetary policy, part of Fiscal and monetary policy effectiveness in Macroeconomics.
When each policy works best and how they interact.
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