A Major Side-Effect of a Stimulative Fiscal Policy Is That

question 8

Multiple Choice

A major side-effect of a stimulative fiscal policy is that it will

• A)discriminate in favor of housing.
• B)crowd out private expenditures.
• C)increase the natural rate of unemployment.
• D)permanently raise the rate of inflation.

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Definitions:

Conditioned Response

A response acquired through learning to a stimulus that was once neutral but has been frequently paired with a stimulus that elicits an automatic response.

Spontaneous Recovery

The reappearance of a previously extinguished conditioned response after a pause.

Stray Dog

A dog that lives on the streets and is not owned or cared for by a specific person.

Extinction

The gradual reduction and eventual disappearance of a conditioned response following the removal of reinforcement.