When the economy is in a recessionary gap, the government can improve economic outcomes by: increasing the money supply, lowering the interest rate, increasing investment spending and consumption spending, and thus increasing aggregate demand. increasing nominal wages, shifting the short run aggregate supply to the left and thus removing the recessionary gap. increasing taxes and aggregate spending via the multiplier. cutting government expenditure, decreasing investment spending and consumption spending, and thus increasing aggregate supply.

Clooney corp. establishes a petty cash fund for $225 and issues a credit card to its office manager. by the end of the month, employees made one expenditure from the petty cash fund (entertainment, $20) and three expenditures with the credit card (postage, $59; delivery, $84; supplies expense, $49).record all employee expenditures, and record the entry to replenish the petty cash fund. the credit card balance will be paid later. (if no entry is required for a transaction/event, select "no journal entry required" in the first account record expenditures from credit card and the petty cash fund.