Procyclical Fiscal Policies

question 43

Multiple Choice

Procyclical fiscal policies:

• A)reduce cyclical fluctuations in the economy, but not as effectively as countercyclical fiscal policies.
• B)reduce cyclical fluctuations in the economy more effectively than countercyclical fiscal policies.
• C)reduce cyclical fluctuations in the economy about as effectively as countercyclical fiscal policies.
• D)increase cyclical fluctuations in the economy.

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Definitions:

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