Often the focus is not on the level of the deficit, but on the change in the deficit. The most immediate.....
of fiscal policy is to change the aggregate demand for goods and services. A fiscal expansion, for example, raises aggregate demand through one of two channels. First, if the government increases purchases but keeps taxes thesame, it increases demand directly. Second, if the government cuts taxes or increases transfer payments, people's disposable income rises, and they will spend more on consumption. This rise in........ will, in turn, raise aggregate demand.