Macroeconomics - Expenditure Gap?

Question

What are the consequences of inflationary expenditure gap?

Answer 1

You mean government expenditure gap, right?

That would mean that the government spends money during an inflationary gap when the output is above the potential output.

Doing that is not a good idea, because government expenditure increases output but also increases inflation. You don't want to do that when inflation is already high. Your economy gets stretched even further (and inflation increases).

I hope that helped.