An Effective Expansionary fiScal Policy Will

question 51

Multiple Choice

An effective expansionary fiscal policy will

• A) reduce a cyclical deficit but necessarily increase the actual deficit.
• B) reduce the cyclically adjusted deficit.
• C) increase the cyclically adjusted deficit but reduce the actual deficit.
• D) always result in a balanced actual budget once full employment is achieved.

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Definitions:

Package Carrier

Companies or services that specialize in the delivery of packages, documents, and freight from one location to another.

Private Fleet

A fleet of transportation vehicles owned and operated by a company for its own logistics and distribution needs.

Safety Inventory

Extra inventory held as a buffer against demand variability and supply chain disruptions to prevent stockouts.

Cycle Inventory

The portion of inventory that companies hold to facilitate smooth production and sales operations, fluctuating based on production cycle needs.