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    Question

    Which of the following is a cause of Excess Demand

    (Inflationary gap) in an economy?
    A Cut in autonomous investment Correct Answer Incorrect Answer
    B Deficits in balance of payments Correct Answer Incorrect Answer
    C Government expenditure > Government revenue Correct Answer Incorrect Answer
    D Cut in capital formation Correct Answer Incorrect Answer

    Solution

    The correct answer is C

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