Which of the Following Fiscal Policy Actions Would Be Appropriate

question 142

Multiple Choice

Which of the following fiscal policy actions would be appropriate if the economy is experiencing an inflationary gap?

• A)an increase in government spending
• B)an increase in taxes
• C)a decrease in interest rates
• D)an increase in the money supply

---

Definitions:

Society

A group of individuals involved in persistent social interaction, or a large social grouping sharing the same geographical or social territory, typically subject to the same political authority and dominant cultural expectations.

Normal

Conforming to a standard; usual, typical, or expected state or condition.

Stereotyped Beliefs

Preconceived notions that are overly simplified and applied to groups or categories of people without acknowledging individual differences.

Psychological Illnesses

Mental health disorders characterized by disturbances in a person's thoughts, emotions, or behavior.