Which of the Following Contributed to the Weak Recovery from the 2008-2009

question 11

Multiple Choice

Which of the following contributed to the weak recovery from the 2008-2009 recession?

• A) The restrictive monetary policy followed by the Fed.
• B) Government spending was increased by only a small amount.
• C) The temporary nature of the tax rebates and spending increases created uncertainty and exerted only a weak impact on aggregate demand.
• D) The budget deficits were too small to exert much impact on aggregate demand, output, and employment.

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Definitions:

Budget Deficit

The financial situation where a government's expenditures exceed its revenues, leading to borrowing or depletion of reserves.

National Debt

The overall monetary liabilities that a country's government has incurred by borrowing from diverse sources.

Budget Deficit

The financial situation where a government's expenditures exceed its revenues within a specific period.

National Debt

National debt is the total amount of money that a country's government has borrowed, typically as a result of budget deficits, through the issuance of securities like government bonds.