Which One of the Following Reduces the Likelihood That Real-World

question 99

Multiple Choice

Which one of the following reduces the likelihood that real-world fiscal policy will promote economic stability?

• A) Policy planners do not know whether a tax cut is expansionary or restrictive.
• B) Policy makers need to know what economic conditions will be like 6 to 18 months into the future, and this is extremely difficult to forecast accurately.
• C) Policy planners are reluctant to implement expansionary fiscal policy even during a serious recession.
• D) Public choice theory suggests that elected political officials will generally favor restrictive fiscal policy.

---

Definitions:

Professionals

Individuals with specialized skills or knowledge in a particular field, often requiring formal education or training.

Qualified Opinion

An auditor's opinion that a company's financial statements are accurate but with certain reservations or exceptions noted by the auditor.

Auditor

A professional who reviews and verifies the accuracy of financial records and ensures compliance with applicable laws and regulations.

Liability

The legal responsibility for one's actions or omissions, often leading to the requirement to compensate for damages or losses caused.