Expansionary Fiscal Policy Is So Named Because It

question 199

Multiple Choice

Expansionary fiscal policy is so named because it

• A)involves an expansion of the nation's money supply.
• B)necessarily expands the size of government.
• C)is aimed at achieving greater price stability.
• D)is designed to expand real GDP.

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Definitions:

GAAP

Stands for Generally Accepted Accounting Principles, a standard framework of guidelines for financial accounting.

Operating Cash Flows

The cash generated from the core business activities of a company in a given period, as opposed to cash flows from investing or financing activities.

Borrowing Capacity

Borrowing capacity is the maximum amount of credit a lender is willing to extend to a borrower, based on their financial strength and other factors.

Amortization

The process of spreading out a loan or intangible asset cost over a fixed period, for accounting and taxation purposes, allowing for a reduction in reported income.