An increase in interest rates

An increase in government spending

High velocity of money

Selling government bonds

An increase in interest rates

An increase in government spending

High velocity of money

Selling government bonds

It is pro-cyclical (makes the business cycle more severe)

It creates excess funds for public projects.

It leads to increasingly high taxes.

It leads to fluctuating tax rates.

It is pro-cyclical (makes the business cycle more severe)

It creates excess funds for public projects.

It leads to increasingly high taxes.

It leads to fluctuating tax rates.