According to the Keynesian Model,the Optimal Fiscal Policy Is to

question 2

Multiple Choice

According to the Keynesian model,the optimal fiscal policy is to

• A)increase cyclical but not structural deficits during a recession.
• B)reduce cyclical and structural deficits during a recession.
• C)increase structural deficits during an recession.
• D)maintain a balanced budget in case of national emergency.

---

Definitions:

Disbursements

Payments made by a business, usually consisting of expenses, investments, and other financial outlays.

Lower Cash Balance Limit

The minimum amount of cash that a business aims to maintain in its cash reserves to meet emergency or operational needs.

Miller-Orr Model

The Miller-Orr Model is a financial model used to manage cash flow and determine the optimal balance between holding cash versus short-term investments.

Disbursements

Payments made by a business, often related to operational expenses or loan repayments.