Which of the Following Statements Does NOT Describe a Problem

question 286

Multiple Choice

Which of the following statements does NOT describe a problem of balancing the budget over the business cycle?

• A) Lags in implementing policy make it difficult to achieve.
• B) Increasing taxes in boom years is politically difficult.
• C) Identifying the phases of the business cycle is not easy.
• D) Increasing taxes at the top of the cycle exacerbates inflation.

---

Definitions:

Great Recession

A significant decline in economic activity across the global economy lasting from late 2007 to mid-2009, considered the worst economic downturn since the Great Depression.

Financial Institutions

Organizations such as banks, credit unions, and insurance companies that provide financial services to consumers and businesses.

Commercial Banks

Financial institutions that offer a wide range of services, including accepting deposits, providing loans, and other investment products.

Fewer Banks

Refers to a situation in the financial sector where the number of banking institutions is reduced, which can affect the competition, availability of credit, and financial stability of an economy.