An Expansionary Fiscal Policy Is Likely to Result in

question 97

Multiple Choice

An expansionary fiscal policy is likely to result in

• A) higher interest rates and lower private investment.
• B) lower interest rates and higher private investment.
• C) higher interest rates and higher private investment.
• D) lower interest rates and lower private investment.

---

Definitions:

Publicly-traded Corporation

A company whose shares are openly sold and traded to the public on one or more stock exchanges.

Earnings and Profits

A measure used by the IRS to determine a corporation’s ability to pay dividends to its shareholders.

Stockholder Basis

The total amount invested in a company by shareholders, including the purchase price of shares, which is used to determine capital gains or losses for tax purposes.

Capital

Financial assets or resources that businesses or individuals use to fund operations, investments, and growth.