Which One of the Following Reduces the Likelihood That Real-World

question 99

Multiple Choice

Which one of the following reduces the likelihood that real-world fiscal policy will promote economic stability?

• A) Policy planners do not know whether a tax cut is expansionary or restrictive.
• B) Policy makers need to know what economic conditions will be like 6 to 18 months into the future, and this is extremely difficult to forecast accurately.
• C) Policy planners are reluctant to implement expansionary fiscal policy even during a serious recession.
• D) Public choice theory suggests that elected political officials will generally favor restrictive fiscal policy.

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Definitions:

Charitable Subscription

A commitment to donate a specified amount of money to a charity or non-profit organization.

Unliquidated Debt

A debt for which the exact amount owed has not been determined or agreed upon.

Accord And Satisfaction

A legal contract wherein parties agree to a settlement that conclusively resolves a dispute or debt.

Forbearance To Sue

An agreement to refrain from filing a lawsuit as part of a negotiation or compromise, despite having grounds for legal action.