L-Unit 2 Part 2 Exam:Fiscal &Monetary Congress would put into place a contractionary fiscal policy when. __ Borrowing is down less loans are being made Unemployment has risen to over 6% Inflation has doubled in the last two quarters and is now 7% Many businesses have had to close down because of poor economic conditions

A contractionary fiscal policy is a measure taken by the government to reduce the money supply in the economy in order to control inflation. This is typically done by reducing government spending, increasing taxes, or both. In this case, the correct answer is "Inflation has doubled in the last two quarters and is now 7%". This is because when inflation is high, the government may implement a contractionary fiscal policy to reduce the money supply and bring down inflation. The other options do not directly relate to the implementation of a contractionary fiscal policy.