(Last Word) in Response to the Great Recession, the Federal

question 167

Multiple Choice

(Last Word) In response to the Great Recession, the federal government engaged in significant deficit-funded spending, but it did not fully achieve the desired result.Which of the following best explains why the fiscal policy actions fell short of their objective?

• A)Monetary policy counteracted fiscal policy, keeping the unemployment rate from falling as much as intended.
• B)Consumers did not respond to the fiscal stimulus as well as hoped, as they put more income into saving and repaying debt.
• C)Although the fiscal stimulus increased consumer spending significantly, it mostly went to purchase foreign-produced goods and services.
• D)The fiscal stimulus caused massive inflation that further disrupted economic activity.

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Definitions:

Securities Trading Costs

Expenses associated with the buying and selling of securities, including brokerage fees, commissions, and taxes.

Speculative Reasons

Motives for making financial decisions based on the anticipation of future market movements, aiming for profit from fluctuations in asset prices.

Average Daily Float

The average amount of uncollected checks or electronic payments in the banking system at any given time.

Processing Delay

The time taken between the initiation and completion of a process, often referring to the time before a transaction or operation is executed.