Which Argument Was a Justification for Breaking with the Normal

question 255

Multiple Choice

Which argument was a justification for breaking with the normal presumption against using discretionary fiscal policy during the Great Recession?

• A) Monetary policy would not be effective because interest rates were so high.
• B) Crowding-out was not likely to be a problem in a very depressed economy with interest rates near zero.
• C) The economy was so depressed that a political business cycle was not likely to be a problem.
• D) Ricardian equivalence was likely if monetary policy was used alone.

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Right Crowd

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A communication approach that focuses on building trust, reducing defensiveness, and encouraging open and honest dialogue, particularly in challenging situations.

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The active and attentive process of hearing and understanding spoken communication from others.