In 2008-2009, Which of the Following Weakened the Demand Stimulus

question 41

Multiple Choice

In 2008-2009, which of the following weakened the demand stimulus effects of expansionary fiscal policy?

• A) the unwillingness of the federal government to run budget deficits
• B) the heavy indebtedness of American households
• C) a high level of household spending on big-ticket items such as houses and cars, which do not promote economic growth
• D) the continuation of the high saving rates on the part of Americans

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