Final answer:
When the economy is experiencing unchecked growth, the government may implement contractionary fiscal policies such as increased taxes and reduced spending to restore aggregate demand and prevent inflation.
However, policymakers may face obstacles due to resistance from individuals and businesses, as well as potential negative effects on government-funded programs and services.
Step-by-step explanation:
When the economy is experiencing unchecked growth, the government may implement policies aimed at restoring aggregate demand and preventing inflation.
Focusing on contractionary fiscal policy, the government can increase taxes and reduce spending to decrease the overall demand in the economy. By doing so, they can control inflation and bring the economy back to a sustainable level.
One potential obstacle policymakers may encounter is resistance from individuals and businesses who do not want their taxes increased or their benefits reduced.
Additionally, reducing spending may impact government-funded programs and services, which can be viewed negatively by the public.
Policymakers need to carefully consider these factors when implementing contractionary fiscal policies.