Which of the Following fiScal Policy Changes Would Be the Most

question 176

Multiple Choice

Which of the following fiscal policy changes would be the most contractionary?

• A) a $40 billion increase in taxes
• B) a $10 billion increase in taxes and a $30 billion cut in government spending
• C) a $20 billion increase in taxes and a $20 billion cut in government spending
• D) a $30 billion increase in taxes and a $10 billion cut in government spending

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Definitions:

Secondary Circular Reactions

Part of Jean Piaget's theory of cognitive development, representing repetitive behaviors in infants aimed at reproducing interesting effects in their environment.

Mental Representations

Internal images, concepts, or thoughts that stand in for objects, events, or relations in the outside world, aiding in understanding and interaction.

Goal-directed Behavior

Actions taken with the intention of achieving a specific outcome or objective, showing purpose and direction in behavior.

Object Permanence

The understanding that objects continue to exist outside of sight.