Why Might an Expansion in Government Spending Increase the Severity

question 130

Multiple Choice

Why might an expansion in government spending increase the severity of the coordination problem during a recession?

• A) Increases in government spending will not affect the composition of aggregate demand.
• B) Congress is unlikely to approve increases in government spending during a recession.
• C) Spending increases will be driven by political considerations and will often flow into areas where resources are already fully employed.
• D) Government spending can be counted on to flow toward high productivity projects.

---

Definitions:

Developmental Purposes

Activities or initiatives aimed at improving capabilities, skills, or infrastructure for better performance or growth.

Performance Reviews

Formal assessments where an employee's job performance is evaluated and discussed, typically on a regular basis, to identify strengths and areas for improvement.

Criterion Deficiency

A situation where the criteria used for evaluating performance do not fully capture or reflect the actual job performance.

Criterion Contamination

Refers to the situation where performance appraisals include factors irrelevant to the employee's actual job performance.