Expansionary Fiscal Policy Is Ineffective If

question 80

Multiple Choice

Expansionary fiscal policy is ineffective if

• A) there are idle resources in the economy.
• B) the MPC is less than 0.60.
• C) the government has a budget surplus.
• D) there is complete crowding out.
• E) a and d

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Definitions:

T Account

A graphical representation used in accounting to show the effect of transactions on individual accounts, displaying debits on the left and credits on the right.

Debts

Money owed by an entity to another party, required to be paid back, typically with interest.

Liabilities

Financial obligations or debts that a business owes to others, which must be settled over time through the transfer of economic benefits.

Dividends

Portions of a company's earnings that are distributed to shareholders, typically in the form of cash or additional shares.