The economy is experiencing inflation and the unemployment rate has dropped from 4.2% to 2.4%. If the government wanted to influence the economy, which tool of fiscal policy should the government impl

The economy is experiencing inflation and the unemployment rate has dropped from 4.2% to 2.4%. If the government wanted to influence the economy, which tool of fiscal policy should the government implement?

Decrease government spending and increase tax rates.

Increase government spending and decrease tax rates.

Buy government securities and lower the reserve requirement.

Sell government securities and increase the reserve requirement.

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