An Example of a Fiscal Policy Designed to Increase Real

question 83

Multiple Choice

An example of a fiscal policy designed to increase real GDP is

• A) a decrease in government expenditure.
• B) a cut in taxes.
• C) an increase in taxes.
• D) None of the above answers is correct.

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Definitions:

Expected-Rate-Of-Return

The anticipated return on an investment, expressed as a percentage of the total amount invested.

R&D Expenditure

The amount of money spent on research and development activities to create new products, processes or improve existing ones.

Interest-Rate Cost

The cost associated with borrowing money, expressed as a percentage of the total amount borrowed, which accrues over the period of the loan.

Venture Capital

Financing that investors provide to startup companies and small businesses believed to have long-term growth potential.