Which Is NOT True Regarding the 2009 Stimulus Plan Enacted

question 224

Multiple Choice

Which is NOT true regarding the 2009 stimulus plan enacted under President Obama?

• A) The stimulus plan included new spending and tax cuts totaling $800 billion to $900 billion.
• B) Many of the tax cuts were saved rather than spent.
• C) Federal grants to states prevented massive state layoffs but also made state agencies highly dependent on the federal government for revenue.
• D) The stimulus plan led to a high degree of crowding out of private investment.

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Definitions:

Externality

A cost or benefit arising from an activity or transaction that affects an unrelated third party who did not choose to incur that cost or benefit.

Command-And-Control Policies

Governmental regulations that directly mandate specific practices or limit activities in order to achieve policy outcomes, such as environmental standards.

Market-Based Policies

Economic strategies that utilize market principles and forces to address and solve problems, often with the goal of improving efficiency and outcomes.

Environmental Protection Agency

A U.S. federal agency established to coordinate and enforce national pollution control laws and regulations to protect human health and the environment.