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The government of Econoland is considering two fiscal policy options to combat a recession:
Option A: Increase government spending on infrastructure by $100 billion
Option B: Cut personal income taxes by $100 billion
a) Which option represents expansionary fiscal policy? Explain why both or neither qualify. (6 points)_
b) For each option, explain how it would help stimulate the economy during a recession. (6 points)
c) Which option would you recommend and why? Consider political and economic factors. (4 points)
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