Which of the Following Is an Appropriate Fiscal Policy to Address

question 75

Multiple Choice

Which of the following is an appropriate fiscal policy to address the inflation that occurs when the economy is above potential GDP?

• A)Decrease taxes to protect consumers from the effects of inflation.
• B)Increase taxes to reduce aggregate demand.
• C)Increase government spending to provide some of the goods consumers can no longer afford at the higher prices.
• D)Decrease government spending so that the demand for money will fall.
• E)Increase transfer payments to poor people,who are hurt the most by the inflation.

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Definitions:

Family

A social unit consisting of parents and their children, considered as a group, whether dwelling together or not; also refers to people who may or may not be related by blood or marriage but share close bonds.

Sports Team

A group of individuals who come together to participate in a competitive sport, sharing common goals, training, and strategies to win games or matches.

Social Cohesion

The extent to which members of a society or group stick together and remain united in pursuit of common goals and interests.

Task Cohesion

The extent to which members of a group work together effectively to achieve shared objectives.