Which of the Following fiScal Policy Changes Would Be the Most

question 55

Multiple Choice

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

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

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Definitions:

Lazarus

Refers to the psychologist Richard Lazarus, known for his theory on emotion and stress which emphasizes the importance of cognitive appraisal.

Social Health

An individual's capacity to form satisfying interpersonal relationships with others and to adapt comfortably to different social situations.

Fight-or-Flight

A physiological response to perceived danger or threat, preparing the body to fight or flee from the threatening situation.

Tend-and-Befriend

A theory suggesting that in response to stress, individuals, especially women, are predisposed to caring for offspring and seeking social support.