Which of the Following Is NOT a Major Limit to the Effectiveness

question 91

Multiple Choice

Which of the following is NOT a major limit to the effectiveness of fiscal policy?

• A) A single increase in government spending is rarely enough to stimulate the economy.
• B) The crowding out effect is transmitted through financial markets.
• C) Fiscal policy is not very effective in combating supply side shocks.
• D) A multiplier effect is associated with changes in spending and taxation.

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Definitions:

Performance

The act of carrying out a task or function, often measured against pre-determined standards of accuracy, completeness, cost, and speed.

Motivational Goals

Objectives that drive behavior by inspiring individuals to take action towards achieving them.

Internal

Pertaining to or happening within an entity, often used in contrast with external factors or influences.

External

refers to something situated on the outside, or beyond the internal or personal; in psychology, it often pertains to factors or influences that originate outside the individual.