Which of the Following Is an Example of a Fiscal

question 43

Multiple Choice

Which of the following is an example of a fiscal policy?

• A) The federal government increases income tax rates on people earning more than $250 000.
• B) The Bank of Canada takes action to greatly decrease the money supply.
• C) The Bank of Canada increases interest rates.
• D) Businesses begin to export and import more products and services.

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Definitions:

Differential Cost

The difference in total cost that will result from selecting one alternative over another in a decision-making situation.

Differential Cost

The difference in total cost that will result from selecting one choice over another.

Additional Cost

Expenses incurred that are above and beyond the initial forecast or budget for a project or product.

Differential Revenue

The difference in revenue generated under two different scenarios or as a result of a specific action.