Fiscal Policy That Seeks to Counteract Business-Cycle Fluctuations Is ________

question 112

Multiple Choice

Fiscal policy that seeks to counteract business-cycle fluctuations is ________ fiscal policy.

• A) pro-cyclical
• B) expansionary
• C) contractionary
• D) discretionary
• E) countercyclical

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Definitions:

Rate of Return

The gain or loss on an investment over a specified period, expressed as a percentage of the investment's initial cost.

Budget Line

A graphical representation of all possible combinations of two goods that can be purchased with a given budget at fixed prices.

Risky Asset

A financial instrument or investment that has a high degree of uncertainty regarding its returns or potential for loss.

Standard Deviation

An indicator of the degree to which a collection of numbers diverges or spreads from their average, signaling the extent of the distribution from the central value.